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TESTIMONY 


TAKEN   BEFORE  THE 


Judiciary  Committee  of  the  Senate 

OF  CALIFORNIA., 


IN  CONSIDERING 


Assembly  Bill  No.  10,  concerning  the  Regulation  of  Railroads, 


(Generally  known  as:  the  Barry  Bill.) 


Twenty-fifth  (Extra)  Session  of  the  Legislature  of  California,  April,  1884.      *• 


PRINTED   BY  ORDER  OF   THE  SENATE. 


SACRAMENTO: 

STATE  OFFICE, JAMES  J.  AYERS,  SUPT.  STATE  PRINTING. 

1884. 


I  ?5 


REPORT. 


On  the  fourth  day  of  April,  A.  D.  1884,  the  Senate  of  California 
referred  to  the  Judiciary  Committee  of  the  Senate,  the  following  bill, 
which  had  passed  the  Assembly  : 

AN   ACT    TO    PREVENT    DISCRIMINATIONS   AND    ABUSES   BY    RAILROAD 

CORPORATIONS. 

The  People  of  the  State  of  California,  represented  in  Senate  and  Assembly,  do  enact  as  follows: 

Section  1.  All  railroads  built  or  owned  by  corporations  organized  under  the  laws  of  the 
State  are  public  highways,  over  which  all  persons  are  entitled  to  transportation  for  persons  and 
property  on  equal  and  impartial  terms.  All  roadway  and  right,  of  way  acquired  by  such  companies 
is  for  public  use.  All  persons  and  companies  engaged  in  operating  any  such  road,  or  in  trans- 
porting freight  or  passengers  over  the  same,  or  which  shall  hereafter  operate  or  engage  as  afore- 
said, shall  forward,  move,  and  carry  impartially  for  all  persons  offering  freight  to  be  transported 
or  moved,  without  discrimination,  preference,  or  favor  to  one  over  another,  in  price,  dispatch, 
speed,  or  accommodation  of  any  kind,  except  as  herein  provided.  All  freight  shall  be  dispatched 
and  forwarded  in  the  order  in  which  it  is  received  or  tendered  for  transportation  (except  that  a 
preference  may  be  given  to  perishable  articles  and  to  express  matter  and  fast  freights),  and 
equal  and  similar  facilities,  not  inferior  to  any  in  use  January  first,  eighteen  hundred  and 
eighty-four,  shall  be  extended  on  like  terms  to* all  connecting  transportation  lines,  whether  by 
land  or  water,  in  the  receipt  and  delivery  of  goods,  exchanging  cars,  making  connections  by 
rail,  and  all  other  arrangements  for  expediting  and  facilitating  the  receipt,  transfer,  transporta- 
tion, and  delivery  of  freight. 

.  2.     All  persons  and  companies  mentioned  in  the  first  section  of  this  Act  shall  at  all 

post  sd  in  a  conspicuous  place,  accessible  to  the  public,  at  each  of  their  stations  and 

-.  a  printed  table  or  schedule,  of  all  rates  of  freight  and  charge   in  force  for  transportation 

between  all  points  and  stations  to  or  from  which  they  carry,  and  shall  furnish  (for  examination) 

a  printed  copy  of  such  table  or  schedule  to  all  persons  demanding  the  same.     Such   rates  shall 

be  equally  available  to  all  persons  demanding  transportation  for  person  or  property  over  said 

road,  or  any  part  thereof,  without  discrimination  or  favor  to  any,  as  provided  in   section  one 

hereof.     All  discounts,  rebates,  special   contracts,  special  rates,  and  other  devices  for  charging 

more  or  less  than  such  published  rates,  are  forbidden;  provided,  that  a  uniform  discount  (to  be 

established  and  published  as  aforesaid)  for  payment  in  advance,  or  for  prompt  payment,  may 

be  made,  and  different  rates  may  be  charged  for  express  matter,  fast  and  slow  freights,  and  for 

-   i    id  lots,  and  lots  under  a  carload;  all  such  rates  and  discounts  to  be  available  to  all  appli- 

on  equal  terms. 

Beo.  3.     All  railroad  corporations  must  at   all    times    maintain   all    their   track   and   other 

structures  in  good  and  sufficient  repair  and  in  a  state  of  complete  efficiency  for  the  purposes  for 

which  they  were  constructed  or  adopted.     Any  such  track  or  structure,  decayed,  destroyed,  or 

removed  must  be  diligently  replaced  or  restored  to  as  good  or  better  condition  of  usefulness  and 

ency  as  before  such  decay  or  removal. 

Bbc.  -l.  No  railroad  corporatiou  organized  under  the  laws  of  this  State  is  permitted  to  accept 
any  charter  or  corporate  franchise  from  any  other  Government,  State,  or  sovereignty:  and  no 
corporation  organized  under  the  laws  of  any  other  Government,  State,  or  sovereignty  is  per- 
mitted  to  operate  any  railroad  or  carry  by  rail  within  this  State. 

Sec.  i.  Section  four  hundred  and  one  of  the  Civil  Code  does  not  apply  to  railroad  corpora- 
tions formed  by  the  consolidation  of  two  or  more  companies  previously  existing:  but  the  term 
of  the  existence  of  corporal  ions  80  formed  shall  not  extend  beyond  that  of  any  of  the  corpora- 
tions entering  into  the  consolidation. 

Sec.  6.  On  the  expiration  or  forfeiture  of  the  charter  of  any  railroad  corporation,  its  road 
and  appurtenances  and  right  of  way  acquired  by  it,  remain  vested  in  the  people  of  the  State 


for  public  use.  Its  other  property  shall  be  sold,  and  the  proceeds,  after  payment  of  its  debts  and 
liabilities,  divided  among  its  stockholders. 

Sec.  7.  Any  railroad  corporation  violating  the  provisions  of  sections  one,  three,  or  four  of 
this  Act,  shall  forfeit  its  charter  and  corporate  privileges,  and  shall  be  adjudged  to  have  incurred 
such  forfeiture  and  to  be  dissolved,  in  an  action  on  behalf  of  the  people  of  this  State,  to  be 
instituted  by  the  Attorney-General.  Any  officer,  agent,  or  servant  of  any  railroad  company. 
who  shall  take  part  in  the  making,  carrying  out,  or  enforcing  of  any  contract  or  agreement  for 
railroad  transportation  in  violation  of  the  provisions  of  this  Act,  or  in  collecting  charges,  or 
paying,  or  allowing  discounts  or  rebates  forbidden  thereby,  or  who  shall  directly  or  indirectly 
enter  into  any  agreement  or  undertaking,  or  give  any  orders  or  directions  for,  or  consent  or 
ratification  to  the  carrying  of  freight  on  terms  in  any  respect  different  from  those  prescribed  in 
this  Act,  or  further  making  of  any  discount  or  rebate  hereby  forbidden,  or  for  violating  the 
provisions  of  this  Act  in  any  particular,  shall  be  deemed  guilty  of  a  misdemeanor,  and  shall  be 
punished  by  imprisonment  for  not  less  than  thirty  days  nor  more  than  six  months. 

Sec.  8.  Rates  of  freight  or  fare  adopted  by  the  Board  of  Railroad  Commissioners,  if  not  put 
in  force  and  complied  with  by  the  railroad  companies  affected,  may  be  enforced  by  writ  of 
mandate  on  behalf  of  the  people,  to  be  sued  out  by  the  Attorney-General.  Any  company  fail- 
ing or  refusing  to  comply  with  a  peremptory  mandate  issued  in  such  action,  shall  forfeit  its 
charter  and  be  dissolved.  On  appeal  from  judgment  awarding  a  peremptory  mandate,  in  such 
cases  there  shall  be  no  stay  of  proceedings  on  appeal. 

The  Senate  Judiciary  Committee,  having  said  bill  under  consider- 
ation, passed  the  following  resolution: 

Resolved,  That  producers,  shippers,  and  merchants  be  invited  to  appear  before  this  committee 
and  make  any  statements  of  facts  pertinent  to  the  matters  involved  in  said  bill,  and  that  any 
member  of  the  committee  may  furnish  to  the  clerk  of  the  committee  names  of  any  persons 
whom  he  may  desire  to  have  appear  before  the  committee. 

Notices  were  sent  to  such  witnesses  in  the  following  form: 

Room  op  Judiciary  Committee,  State  Capitol,  Cal.  ) 
:  Sacramento, ,  1884.  j 

Dear  Sir:  By  request  of  the  Judiciary  Committee  of  the  Senate  of  California,  you  are 
hereby  invited  to  appear  before  said  committee,  at  your  earliest  convenience,  to  make  state- 
ments to  the  committee  concerning  the  matters  involved  in  the  Barry  Bill  (so  called),  now 
pending  before  said  committee.     Very  respectfully, 

SUMNER  T.  DIBBLE,  Secretary. 

By  order:  C.  W.  CROSS,  Chairman. 

All  witnesses  who  appeared  for  examination  were  examined  by  the 
committee,  each  Senator  being  permitted  to  ask  questions.  The  evi- 
dence was  taken  down  by  a  shorthand  reporter,  and,  by  resolution  of 
the  Senate,  duly  passed  April  14,  was  printed. 

The  evidence  taken  was  as  follows: 


Statement  of  Mr.  Harrison, 

Of  the  firm  of  Richards  &  Harrison,  San  Francisco,  before  the  Judiciary 
Committee  of  the  Senate  of  the  State  of  California. 

Mr.  Chairman  and  Gentlemen:  I  am  really  unprepared  for  this 
opportunity,  of  which,  with  a  little  preparation,  I  should  have  been 
very  happy  to  have  availed  myself;  yet  the  worthy  Senator  from 
San  Francisco  having  introduced  me,  if  I  am  allowed  to  show  you 
the  action  of  the  special  contract  system,  and  how  it  has  affected  the 


merchants  of  our  State,  if  that  is  germane  to  the  subject,  I  should 
like  to  make  a  few  remarks,  inasmuch  as  our  firm  have  been  per- 
sonal sufferers,  and  we  have  been  endeavoring  through  the  Railroad 
Commission  to  obtain  relief  from  the  oppression  of  the  special  con- 
tract system.  I  suppose  you  are  aware  that  there  are  four  provisions, 
which,  stripped  of  their  verbiage,  may  be  expressed  in  a  few  words. 

The  special  contract  system,  such  as  the  Central  Pacific  Railroad 
and  the  Southern  Pacific  Railroad  have  adopted,  exacts  that  the 
signer  shall  not  patronize  sailing  vessels  or  steamers,  nor  import 
their  goods  into  this  State  in  that  manner.  That  he  shall  not  buy 
from  or  sell  to  a  man  who  is  not  a  contractor.  That  they  shall  have 
the  right  to  examine  our  goods  and  see  that  the  classification  of  all 
the  goods  is  conformed  to.  That  they  shall  have  the  right  to  exam- 
ine our  books,  and  if  necessary  break  into  our  safe  and  examine  it 
to  see  that  we  do  not  buy  from  or  sell  any  freight  to  a  man  who  is 
not  a  contractor.  Now,  gentlemen,  I  admired  the  Chairman  of  this 
committee  to-day  when  he  offered  a  resolution  indorsing  the  action 
of  our  Minister  to  Berlin;  because  he  made  a  fine  and  a  strong 
effort  to  prevent  the  German  Empire  from  discriminating  against 
the  American  hog.  Gentlemen,  you  needn't  go  to  Germany  to  make 
.your  discriminative  fight.  Your  discriminative  fight  is  with  the 
railroad  company,  as  discriminating  against  the  merchants,  and  if 
our  Ministers  are  to  be  extolled  for  protecting  the  American  hog,  the 
California  merchants  will  thank  the  Legislature  for  protecting  the 
American  merchants.  Now  this  bill  of  Mr.  Barry's,  as  far  as  it  is 
apparent,  is  intended,  and  it  occurs  to  me  to  say,  that  the  desire  of 
our  community  is  that  this  discriminative  action  should  be  abolished, 
and  in  order  to  do  that  it  will  be  necessary  to  adopt  the  extreme 
measures  of  penalty  as  they  appear  in  the  bill. 

The  railroad  has  affected  everything.  We  have  from  day  to  day 
submitted  our  case  to  the  Railroad  Commission,  and  have  been  met 
with  the  information  that  they  have  no  authority  and  no  power  to  reach 
this  matter;  that  it  is  beyond  their  jurisdiction.  What  is  the  use  of 
referring  anything  to  the  Railroad  Commission  if  they  have  no  juris- 
diction and  claim  none?  Although  members  of  the  legal  profession 
say  that  they  have  jurisdiction,  they  turn  round  and  say  that  they 
have  not,  and  the  result  is  that  the  matter  is  thrown  back  into  your 
teeth,  and  I  can  see  no  help  for  it  now  but  to  pass  a  specific  law  that 
will  reach  it.  As  far  as  its  being  a  party  measure,  I  think  it  ought 
to  be  put  down  as  one  of  the  few  measures  outside  of  party.  I  may 
be  put  down  as  one  of  the  few  merchants  that  have  contended  with 
the  railroad.  The  result  of  this  discrimination  has  so  enslaved  our 
community  that  they  will  not  appear  before  you.  Our  Board  of 
Trade  and  our  Chamber  of  Commerce  have  railroad  agents  in  their 
bodies  and  there  is  not  a  man  that  dare  put  his  head  up  without 
being  marked.  The  Central  Pacific  Railroad  Company  do  what  the 
United  States  Government  do  not  dare  to  do.  In  the  Custom  House 
the  Republican  and  the  Democrat,  the  Chinaman  and  the  Greek, 
are  all  classed  alike — every  man  knows  his  tariff.  The  grade  is  grad- 
ual, and  there  is  no  distinction  and  no  discrimination.  Now,  I  do 
not  pretend  to  be  a  lawyer ;  I  do  not  pretend  to  be  able  to  qualify 


6 

this  bill  with  any  legal  aspect;  but  as  far  as  its  spirit  is  concerned,  it 
appears  to  us  as  the  proper  expression.  We  have  got  to  have  relief. 
We  must  have  relief.  Discrimination  cannot  exist  in  any  civilized 
community.  You  do  not  dare  to  do  it  in  your  own  family,  nor  to 
discriminate  against  one  of  your  children,  without  seeing  how  quick 
he  will  take  offense.  You  must  prevent  it  and  give  us  relief,  and 
this  bill,  as  I  understand  it,  will  do  so.  Unless  you  make  the  pen- 
alty severe  they  will  escape  it  again  as  they  have  continued  to  escape 
others. 

Beyond  this  I  have  nothing  to  say.  If  you  are  desirous  of  know- 
ing about  the  system  the  railroad  has  adopted  with  the  merchants,  I 
am  here  to  answer  any  questions.  Few  merchants  dare  to  do  so, 
because  they  have  become  their  slaves.  If  you  shut  out  our  shipping 
vessels  and  steamers,  you  might  as  well  shut  up  the  Golden  Gate  as 
far  as  the  merchant  doing  business  in  San  Francisco  is  concerned. 
He  might  as  well  be  in  the  heart  of  Arizona.  The  same  contract 
extends  to  other  places  besides  San  Francisco,  and  they  import  their 
goods  in  the  interior  towns.  What  would  New  York  do  without  pro- 
tection from  things  of  that  kind?  Here  we  have  the  opening  of  the 
Pacific  closed  up.  Do  you  suppose  that  the  merchants  went  volun- 
tarily into  this  system  of  serfdom?  No,  sir;  the  first  man  was 
beguiled  through  Stubbs  ■  and  Vining,  their  oily  agents.  They 
beguiled  the  first  few;  intimidated  some,  and  coerced  the  balance. 
We  are  now  fighting  for  the  beautiful  harbor  of  San  Francisco.  We 
are  no  better  off  than  the  merchants  of  Arizona.  With  the  Golden 
Gate  closed  up  we  might  just  as  well  emigrate.  What  is  California 
without  the  Golden  Gate  and  the  bay?  Nothing.  We  are  closed  up 
with  our  fine  harbor  and  our  facilities.  I  will  be  very  happy  to 
answer  any  questions. 

Mr.  Sullivan — What  is  the  ground  upon  which  the  Railroad  Com- 
mission stated  its  opinion  that  they  had' no  jurisdiction  in  your  case? 
Answer — They  claimed  that  these  contracts  had  been  made  mainly 
in  Omaha,  some  two  thousand  miles  from  here,  by  Mr.  Vining,  the* 
agent  of  the  Union  Pacific  Railroad  Company,  and  that  they  had  no 
control  over  such  contracts  made  out  of  this  State.  In  other  words, 
that  the  merchants  of  San  Francisco  are  bound  by  a  contract  made 
two  thousand  miles  from  San  Francisco,  alongside  of  the  Missouri 
River,  where  they  had  never  seen  a  ship. 

Q.  Out  of  the  proceeds  received  from  freight,  what  is  the  percent- 
age of  the  Central  Pacific  Railroad?  A.  They  get  forty-six  per  cent, 
and  the  Union  Pacific  Railroad  gets  fifty-four,  and,  although  the 
counsel  for  the  railroad  admitted  that  they  were  responsible  only  for 
what  was  collected  in  this  State,  that  proportion  belonging  to  the  Cen- 
tral Pacific  Railroad  Company,  our  worthy  Railroad  Commission- 
ers claimed  that  they  had  no  jurisdiction  over  that  either,  and  that 
they  had  no  jurisdiction  at  all. 

Q.  Upon  the  ground  that  the  contract  was  made  outside  of  this 
State?    A.  Yes,  sir. 

Q.  That  they  could  not  segregate  it?  A.  They  could  not  segre- 
gate it.  It  was  segregated  and  admitted  in  Court  that  they  had  seg- 
regated it,  and  that  they  had  collected  forty-six  per  cent — that,  it 


was  claimed,  was  the  portion  of  the  Central  Pacific  Railroad  Com- 
pany. They  took  the  ground  that  no  more  contracts  should  be  made 
with  the  Union  Pacific  Railroad  Company.  That,  they  knew  would 
break  up  the  special  contract  system. 

Q.  Do  I  understand  you  that  they  discriminated  against  your  firm, 
in  favor  of  merchants  in  San  Francisco?  A.  They  have  open  rates, 
and  contract  rates.  By  signing  a  contract  they  get  contract  rates  ;  if 
you  don't  you  have  to  pay  open  rates.  We  were  the  largest  importers 
in  our  line  of  goods — do  more  than  all  the  rest — and  we  saw  that  we 
could  not  do  justice  to  our  business,  our  customers,  and  ourselves, 
and  sign  a  special  contract,  and  the  rates  on  the  goods  compelled  us 
to  get  our  goods  around  the  Horn,  by  sea.  We  had  to  sign  a  con- 
tract, by  the  custom  of  the  road,  or  pay  open  rates,  and  as  soon  as 
they  made  us  do  that  we  commenced  suit  against  them. 

Q.  What  is  the  difference  between  the  contract  and  the  open  rates? 
A.  From  fifteen  to  fifty  per  cent. 

Q,.  Did  they  take  the  position  that  there  was  no  discrimination 
because  these  were  open  contracts  that  everybody  could  sign?  A. 
We  had  the  privilege  of  signing  them. 

Q.  Did  not  two  of  the  Commissioners  say  that  it  was  not  discrim- 
ination within  the  purview  of  the  Constitution?  A.  They  said  that 
we  could  sign  the  contract  just  as  we  could  in  the  retail  business. 
That  it  was  just  the  same  thing. 

Q.  What  would  be  the  effect  of  the  Barry  bill  upon  this  discrim- 
ination that  you  speak  of?  A.  As  I  understand  it  here,  merchants 
against  whom  discrimination  was  had  might  appeal  to  the  Attorney- 
General  to  have  the  charter  of  the  road  forfeited. 

Q.  How  could  you  prove  that  they  discriminated  ?  A.  It  is  merely 
a  matter  requiring  evidence.  Their  admissions  are  on  file,  and  a 
special  contract  is  easily  obtained,  and  the  open  rates  can  be  easily 
obtained  ;  so  that  any  one  can  see  that  there  is  a  plain  discrimina- 
tion.    A  matter  of  figures  between  fifteen  and  fifty  per  cent. 

Q.  Is  there  any  truth  in  what  is  said  about  the  railroad  company, 
that  they  charge  according  to  the  value  of  the  material?  A.  Yes, 
they  do.  In  one  case  that  I  will  quote :  Ruled  paper  pays  sixty  per 
cent  more  than  unruled  paper.  The  ruling  alone  making  a  differ- 
ence of  sixty  per  cent.  In  plain  English,  they  take  the  oyster  and 
leave  the  merchant  the  shell. 

Q.  Do  you  know  of  any  instance  where  they  have  examined  the 
books  of  the  merchant  for  the  purpose  of  finding  out  whether  he 
has  stood  by  the  special  contract  made  with  the  railroad  ?  A.  Yes, 
sir ;  I  presume  they  have  nullified  contracts,  and  the  parties  have 
commenced  suits  for  damages  where  they  had  a  special  contract, 
where  a  man  dared  to  buy  goods  from  a  party  who  carried  them 
around  the  Horn.  They  have  a  system  of  rebate  by  which  they 
exact  open  rates,  and  they  remain  for  a  period  of  from  one  to  three 
months,  and  then  repay  the  difference  between  the  open  and  the 
special  rates,  thus  always  keeping  the  merchant  in  debt  and  slavery. 

Q.  What  is  meant  by  the  term  "expense  bill?"  A.  It  means  a 
freight  bill  where  the  amount  is  intended  to  be  refunded,  notifying 
the  agent  to  collect  and  to  pay  the  difference  within  a  period  of  *^To 
or  three  months. 


8 

Q.  You  mean  to  say  that  they  charge  the  open  contract  rate,  and 
then  return  it?  A.  They  used  to  do  that,  but  I  understand  that  they 
found  that  it  was  not  necessary,  and  they  discontinued  it,  and  now 
they  collect  their  contract  rates. 

Q.  What  is  the  position  of  the  merchants  of  San  Francisco  in 
regard  to  this  railroad  company,  if  they  were  called  upon  by  this 
committee  to  give  testimony  here  ?  Will  they  testify  in  regard  to 
these  matters  ?  Will  they  dare  tell  the  truth  here  ?  A.  I  never  knew 
them  to  tell  the  truth  yet. 

Q.  Are  you  acquainted  with  the  mercantile  community  of  San 
Francisco  ?    A.  Yes,  sir. 

Q.  How  long  have  you  resided  in  San  Francisco  and  been  engaged 
in  business  there  ?    A.  Fifteen  or  sixteen  years. 

Q.  Do  you  know  the  most  of  the  importing  houses  there?  A.  I  do, 
sir.  I  believe  I  have  collected  from  the  wholesale  houses  of  San 
Francisco  for  the  last  fifteen  years,  twice  a  month  regularly. 

Q,  You  have  a  large  personal  acquaintance?  A.  Yes,  sir,  and 
with  the  Board  of  Trade. 

Q.  Have  you  talked  with  the  merchants  there  sufficiently  to  speak 
advisedly  as  to  whether  or  not  they  would  be  willing  to  come  here 
and  give  testimony  concerning  any  discrimination  that  might  be 
made  against  them,  or  concerning  the  question  of  discrimination  at 
all?  A.  I  have  talked  with  them  frequently.  When  I  subpoenaed 
them  in  my  case  to  testify  they  came  to  me  with  tears  in  their  eyes 
and  begged  off. 

Q.  What  was  their  excuse?  A.  That  their  business  pursuits  were 
so  closely  allied  to  the  railroad  business  that  they  didn't  dare  to  go; 
that  their  contracts  might  be  broken  again,  as  they  had  been,  upon 
that  pretense. 

Q,.  They  all  wished  you  success?  A.  Certainly ;  they  pat  me  on 
the  back  behind-hand,  and  tell  me  I  am  the  champion. 

Mr.  Brooks — Do  I  understand  you  that  you  have  no  fault  to  find 
with  any  other  company  than  the  Central  Pacific  Railroad  ?  A.  And 
the  Southern  Pacific  Railroad  Company. 

Q.  They  do  not  allow  you  to  buy  from  parties  that  ship  around  the 
Horn  ?     A.  No,  sir. 

Mr.  Cross — Have  you  ever  found  a  lawyer  who  advised  you 
that  a  special  contract  that  limited  you  to  whom  you  should  buy 
from  was  not  valid  in  law?  A.  I  have  heard  them  say  it  all  along, 
but  it  is  a  very  difficult  thing  to  prove  without  consulting  with  the 
merchants. 

Q.  I  would  like  to  know  whether  the  importers,  as  a  class,  are  dis- 
satisfied with  the  present  system  ?  A.  I  can  tell  you  as  a  fact,  that 
out  of  the  hundred  and  odd  merchants  in  San  Francisco,  there  are 
five  who  approve  of  the  special  contract  system. 

Q.  Could  you  give  us  an  idea  as  to  whether  or  not  that  system 
increases  the  cost  of  goods  in  the  general  markets  of  this  State?  A. 
It  does. 

1 1.  Could  you  give  us  some  idea  as  to  what  per  cent  ?  A.  The  fact 
is  just  this:  Certain  goods  will  come  around  the  Horn  by  sailing 
vessels — heavy  goods — hardware,  nails,  and  things  of  that  class,  and 


certain  other  goods  come  by  steamer,  and  certain  other  things  of  finer 
quality,  changing,  by  nature  of  the  fashions,  or,  are  of  great  value, 
would  naturally  come  by  rail.  Now,  if  we  had  these  importations 
by  three  channels,  we  would  have  every  class  of  goods  bearing  its 
natural  and  proper  burden  of  freight.  As  it  is  now,  they  make  a 
certain  reduction  upon  heavy  goods,  and  make  it  up  on  other  classes 
of  goods.  That  is  what  we  should  have  from  the  opportunities  that 
the  seaboard  naturally  gives  us,  but  as  the  thing  stands  now,  nearly 
every  merchant  of  San  Francisco  has  been  coerced,  or  beguiled  into 
this  special  contract,  and  the  balance  have  been  compelled  to  go  out 
of  business.  We  import  a  certain  class  of  goods  around  the  Horn, 
not  having  any  special  contract,  that  would  only  come  in  vessels,  and 
if  that  is  taken  away,  there  will  be  no  independence  any  more  among 
our  merchants,  and  there  is  no  such  thing  as  profit  any  more  in  Cal- 
ifornia since  it  has  been  done;  that  has  been  taken  from  us. 

Mr.  Reddy — Is  it  not  a  well  known  fact  that  the  merchant,  if  he 
does  not  enter  into  this  special  contract  with  the  road,  will  have  to 
pay  advance  rates;  that  is,  that  the  freight  on  his  goods  will  cost 
him  a  great  deal  more?  A.  Yes,  sir;  I  should  say  from  fifteen  to 
fifty  per  cent,  according  to  the  exactions  of  the  railroad. 

Q.  Whether  that  contract  is  legal  or  not  cuts  no  figure?  A.  It 
cuts  no  figure.   " 

Qr.  From  fifteen  to  fifty  per  cent  is  sufficient  to  make  almost  any 
device  legal  if  he  will  suffer  that  by  not  entering  into  it?  A.  Yes, 
sir;  if  he  wants  to  keep  in  business. 

Q.  And  the  railroad  company  have  so  managed  that  business  as  to 
get  nearly  all  the  merchants  into  the  system?    A.  Yes,  sir. 

Q.  And  each  one  that  fails  to  abide  by  these  contracts  is  compelled 
to  pay  extra  freight?     A.  Exactly. 

Q.  And  further  ostracised  by  not  being  permitted  to  buy  from  any 
other  merchants  who  do  not  enter  into  the  system?  A.  He  cannot 
buy  from  them. 

Q.  And  the  result  is  that  he  might  not  only  be  injured  by  the 
extra  charge,  but  his  business  may  be  broken  up  entirely  ?  A.  Yes, 
sir. 

Q.  Do  you  know  of  any  instances  of  discrimination  in  the  matter 
of  forwarding  freights  outside  of  the  advance  in  charges;  do  you 
know  of  any  discrimination  in  the  forwarding  and  delivery  of 
freights?  A.  In  our  special  case,  when  they  found  out  that  we  had 
the  temerity  to  contend  with  the  Central  Pacific  Railroad  Company, 
they  stopped  our  freight  entirely.  They  said  that  we  must  pay  our 
freight  in  advance.  We  were  paying  more  than  anybody  else,  and 
for  that  reason  must  pay  in  advance;  and  by  corresponding  with  the 
traffic  manager  he  said:  "If  you  sign  our  special  contract  you  can 
have  it  delivered,  and  needn't  pay  before  you  deliver  it."  And 
in  our  case  our  goods  were  stopped  on  the  road,  and  we  had  to  send 
a  check  forward  twenty  days  before  the  goods  got  here  in  conse- 
quence of  the  instructions  given  by  the  Central  Pacific  Railroad 
Company  that  any  freight  coming  for  Richards,  Harrison  &  Co. 
must  have  the  freight  paid  in  advance.  That  is  how  we  are  situated. 
Perhaps  that  is  not  discrimination. 


10 

Q,  Do  you  know  of  any  other  merchants  who  have  been  treated 
in  the  same  manner?  A.  I  do  not,  Senator.  I  know  one  that  had 
his  contract  taken  away  from  him  and  the  man  ruined  in  the  busi- 
ness, and  he  commenced  suit  against  them  for  damages. 

Q.  Do  you  know  whether  or  not  he  made  application  to  the  Rail- 
road Commissioners  for  redress?     A.  No,  I  do  not. 

Q.  I  understood  you  to  say  that  you  formally  made  application  to 
the  company  for  redress?     A.  We  did. 

Q.  And  the  answer  was  that  they  had  no  power  and  no  jurisdic- 
tion? A.  No  jurisdiction.  That  we  had  the  power  to  sign  the  con- 
tract as  well  as  anybody  else,  and  we  did  not  sign  it. 

Q.  It  was  suggested  to  you  by  the  railroad  company  that  you  had 
better  sign  the  contract.     Was  that  the  idea?    A.  Exactly. 

Senator  Spencer — It  is  only  the  same  class  of  goods  that  you  are 
prohibited  from  buying  from  people  that  ship  around  the  Horn? 
A.   Any  kind  of  goods. 

Q.  You  don't  mean  to  say  that  because  they  have  a  special  con- 
tract with  you  that  you  cannot  buy  any  other  kind  of  goods  which 
are  shipped  around  the  Horn?     A.  Any  kind  of  goods. 

Q.  I  thought  that  it  was  goods  that  you  shipped  by  the  railroad 
company?     A.  No,  sir;  any  kind  of  goods. 

Q.  Supposing  that  there  was  a  dispute  between  the  railroad  com- 
pany and  the  consignee,  as  to  freight,  say  about  a  matter  of  $500. 
Would  you  have  any  rule  in  regard  to  paying  that?  A.  I  would 
have  to  pay  for  it,  and  then  duplicate  it,  and  try  to  get  it  back  from 
them. 

Q.  Senator  Cross  asked  whether  you  had  asked  any  lawyer  whether 
that  part  of  the  contract  which  related  to  the  prevention  of  your 
buying  from  any  other  parties  than  those  with  whom  you  had  the 
special  contract,  was  void  as  against  public  policy? 

Mr.  Cross — No;  that  was  not  exactly  as  I  asked  it. 

A.  That  has  been  the  general  construction.  I  never  saw  a  lawyer 
yet  that  did  not  say  it  was  unlawful. 

Q.  That  it  was  void?    A.  Yes,  sir;  void,  illegal. 

Q.  Upon  what  terms  did  they  forfeit  this  man's  contract,  and  take 
it  away  from  him?  A.  They  did,  added  on  increased  rates  of  freight. 
The  man  had  two  carloads  of  goods  arrive  under  his  contract.  He 
was  connected  with  one  of  the  oldest  and  most  respected  houses  of 
San  Francisco.  It  was  some  cooper  stock,  and  they  found  out  that 
this  party  had  bought  some  lumber — heavy  lumber — which  came 
around  the  Horn  ;  that  this  contractor  had  bought  his  goods  from  a 
house  that  did  not  have  a  special  contract.  When  the  first  carload 
of  his  goods  arrived  they  raised  him  up  thirty-three  per  cent.  He 
propounded  the  question  to  them:  "Why  do  you  charge  me  over 
the  contract  rates?"  and  the  answer  was,  "For  cause."  Every  officer 
that  he  went  to,  up  to  his  royal  highness,  Mr.  Stubbs,  answered,  "  For 
cause." 

Q.  Do  you  know  that  there  are  people  employed  by  the  railroad 
company  for  the  purpose  of  finding  out  whether  a  man  is  following 
out  his  contract?  A.  Yes,  sir;  they  have  spies.  They  have  men 
on  the  wharf  to  take  the  marks  of  the  goods,  and  to  follow  up  the 


11 

dray,  and  see  where  it  goes,  and  to  examine  the  tags,  and  see  whom 
you  sell  to,  and  will  ask  for  the  key  to  your  safe. 

Q.  That  is  what  you  stipulate  for  in  the  contract?    A.  Yes,  sir. 

Q.  That  is  one  of  the  reasons  why  you  wouldn't  sign  the  contract? 
A.  Exactly. 

Q.  Have  you  a  copy  of  one  of  those  contracts?  A.  No,  sir;  but  I 
can  get  you  one.    The  Railroad  Commission  have  one. 

Q.  What  is  the  status  of  your  case  in  Court?  A.  They  are  trying 
to  keep  it  out  of  the  Federal  Courts,  and  in  the  State  Courts.  That 
is  one  reason  why  I  like  the  Barry  bill. 

Q.  You  brought  suit  against  them  in  the  State  Court,  and  they 
tried  to  remove  it  to  the  Federal  Courts?  A.  Yes,  sir;  but  they  have 
not  succeeded. 

Q.  You  have  the  complaint  filed,  and  have  argued  the  matter  as 
to  jurisdiction?    A.  That  is  all,  so  far. 

Q.  Did  I  understand  you  to  state  that  they  declined  to'allow  you 
to  sign  the  special  contract?    A.  No,  sir. 

Q.  Has  the  discrimination  on  the  part  of  the  railroad  company 
contributed  to  increase  the  price  of  any  commodity  in  San  Fran- 
cisco? A.  Yes,  sir;  I  hold  that  it  does.  The  rates  are  arbitrary. 
Certain  goods  would  naturally  come  round  the  Horn,  and  by  steamer 
as  well  as  by  rail,  and  be  cheaper. 

Q.  What  class  of  goods  have  you  been  dealing  in  that  would  have 
been  received  in  this  way?  A.  Beer,  principally.  I  have  been  deal- 
ing in  it  a  good  many  years. 

Q.  That  is  one  of  the  largest  imports?    A.  Yes,  sir. 

Q.  What  would  be  the  difference  in  getting  them  over  the  two 
routes?    A.  A  difference  of  fifty  dollars  to  a  carload. 

Q.  How  many  cases  in  a  carload?    A.  Eighty  barrels. 

Q.  About  seventy  cents  to  a  case  ?  A.  Yes,  sir ;  enough  to  keep  us 
out  of  business. 

Q.  Could  you  sell  these  so  much  less  a  case  if  you  had  the  benefit 
of  these  contracts?     A.  Yes,  sir. 

Senator  Whitney — Everybody,  I  understand,  ha,s  the  right  to 
enter  into  these  contracts  if  they  choose.  There  is  no  discrimination 
as  far  as  that  is  concerned  ?  A.  Generally  they  do,  but  they  have 
refused  to  give  them  to  some  people  that  I  know  of. 

Q.  Do  you  know  of  any  person  who  has  declined  the  privilege 
of  entering  into  these  contracts?  A.  I  do.  The  way  that  we  have 
managed  our  business,  we  send  our  goods  ten  thousand  miles;  by  rail 
from  Milwaukee  to  New  York,  and  then  around  the  Horn;  some 
thousands  of  miles  by  water  by  sailing  vessels,  and  a  voyage  takes 
about  six  months.  We  import  our  goods  for  one  half  of  the  contract 
price  on  the  railroad, 

Q.  So  really  you  make  money  out  of  that?     A.  Yes,  sir. 

Q.  So  really  there  is  no  great  hardship  about  it  after  all,  only  you 
do  not  get  goods  so  quick?  A.  We  are  ostracised  in  business,  and 
that  is  an  outrage. 

Q.  By  sending  to  New  York  you  get  them  for  one  half  the  price? 
A.  In  this  special  instance,  yes. 

Q.  The  difference  in  the  price  would  make  more  than  you  lose  in 
interest?     A.  Yes,  sir. 


12 

Q.  So,  actually,  by  going  to  New  York,  and  getting  goods  round 
the  Horn,  you  get  goods  cheaper,  and  every  other  merchant  could  do 
the  same  if  he  chose?  A.  Exactly;  but  they  have  got  to  get  certain 
classes  by  rail. 

Q.  The  special  contract  works  a  benefit  to  you  rather  than  an 
injury?  A.  No;  I  don't  think  it  does.  I  think  I  would  go  out  of  busi- 
ness by  it.  We  have  a  good  deal  of  business,  but  our  firm  can't  fight 
them  alone.  We  have  refused  a  hundred  agencies.  We  can't  do 
American  business.  We  can't  afford  to  pay  fifty-three  per  cent  and 
expect  to  exact  that  from  the  public. 

Q.  You  could  send  these  other  goods  to  New  York,  and  send  them 
around  the  Horn  the  same  as  beer?  A.  And  pay  additional  for  the 
goods  to  be  sent  by  rail?  No,  sir;  you  can't  do  that.  The  railroads 
are  built  for  the  people. 

Q.  Why  couldn't  you  do  it?  A.  Because  certain  classes  of  goods 
pay  ninety  dollars  a  ton  to  New  York. 

Q.  Why,  can't  you  send  other  classes  of  goods  around  the  Horn  the 
same  as  you  do  beer?  A.  No;  the  railroads  have  the  odds  on  goods 
where  the  goods  are  light  and  expensive. 

Q.  Could  you  get  them  as  quick?  There  are  classes  which  it  is 
necessary  to  get  in  time  that  you  are  kept  out  of  by  not  being  able  to 
ship  them  when  wanted?  A.  Certainly;  if  the  goods  are  valuable, 
you  can  afford  to  pay  railroad  freight. 

Senator  Brooks — You  can't  do  American  business,  you  say  ?  A. 
No,  sir;  on  account  of  the  discrimination  we  are  not  able  to  get  a 
certain  class  of  goods  around  the  Horn. 

Q.  Your  complaint  is  not  so  much  about  that  as  it  is  that  it 
deprives  you  of  American  trade  ?    A.  Yes,  sir. 

Senator  Sullivan — Does  it  not  require  a  large  capital  to  do  busi- 
ness where  you  send  goods  around  the  Horn,  much  more  than  it 
would  if  you  could  get  those  goods  in  a  few  weeks?    A.  Yes,  sir. 

Senator  Cross — It  would  throw  the  business  into  the  large  import- 
ing houses  ?  A.  Yes,  sir.  Merchants  should  have  the  privilege  of 
importing  goods  by  rail  or  by  water,  and  they  should  all  be  allowed 
to  ship  at  the  same  price.  We  have  got  to  have  it,  or  the  country 
cannot  prosper. 

Senator  Sullivan — Supposing  that  all  the  merchants  of  San 
Francisco  should  enter  into  this  special  contract  system,  if  ships 
came  out  here  wouldn't  they  have  to  come  out  in  ballast  if  they 
wanted  any  particular  freight  from  this  coast,  such  as  wheat,  for 
instance?  A.  If  all  signed  the  contracts  no  ships  would  come  here 
at  all. 

Q,  If  they  did  come  for  shipping  wheat  or  grain,  wouldn't  they 
have  to  come  out  in  ballast?  A.  I  would  think  so;  they  might 
bring  coal ;  I  don't  believe  that  the  railroad  company  have  a  special 
rate  on  coal ;  they  must  have  overlooked  that. 

Mr.  Whitney — Does  it  make  one  or  two  dollars  difference  in  the 
price  of  coal,  whether  they  have  to  bring  it  for  ballast?  A.  I  don't 
know  as  they  would  lose  any  money  on  coal. 

Senator  Sullivan — Would  it  not  be  better  for  the  farming  interests 
if  a  great  part  of  the  freight  were  brought  here  in  ships,  so  that  they 


13 

could  have  freight  both  coming  and  going?  A.  Preciselj'.  The 
freight  of  the  farmer  would  be  a  great  deal  less ;  we  should  have  some 
encouragement  for  ships  to  come  here,  and  on  some  goods  we  can 
give  them  reasonable  freights  for  coming,  and  ships  are  not  coming 
here  unless  they  get  freight  from  the  farmer;  that  is  plain  enough, 
and  I  see  that  it  has  been  talked  about  that  our  railroads  are  trying 
to  keep  our  ships  away  from  here  entirely,  and  if  they  can't  bring  coal 
here,  the  farmer  will  be  compelled  to  ship  his  wheat  by  rail. 

Q.  If  we  could  encourage  the  building  of  ships  in  the  harbor  of 
San  Francisco,  wouldn't  that  give  us  some  relief?  A.  Only  by  taxes, 
or  something  of  that  sort. 

Q.  It  is  stated  in  one  of  these  documents  that  the  port  charges  are 
higher  in  San  Francisco  than  in  any  other  of  the  American  cities? 
A.  Dockage  is  cheaper  in  San  Francisco  than  in  any  other  city. 

Q.  I  understand  you  to  say  that  if  the  merchant  deals  with  those 
who  do  not  have  a  contract  with  the  railroad  company,  they  are 
tabooed?  A.  Yes,  sir;  there  is  a  provision  put  into  the  contract  for 
that  purpose,  that  if  it  could  be  arranged  by  two  merchants,  one 
shipping  around  the  Horn  and  the  other  by  rail,  that  by  transfer- 
ring carloads  of  goods,  one  to  the  other,  so  as  to  suit  the  require- 
ments of  their  trade,  they  might  do  so,  and  this  is  put  in  there  to 
prevent  any  goods  being  sent  by  water  at  all.  I  suppose  they  are 
afraid  that  a  merchant  could  come  into  our  store  and  buy  five  or  ten 
packages  of  goods,  and  so  they  have  regarded  that  as  a  reason  to  can- 
cel their  agreement,  and  if  I  were  to  buy  a  carload  of  goods  from  a 
contractor,  and  it  was  known,  it  would  vitiate  that  man's  contract, 
and  they  would  decline  to  bring  his  goods  at  contract  rates,  and  ruin 
him  in  business. 

Q.  I  want  to  ask  you  whether  the  railroad  discriminates  against 
you  in  Colorado,  Montana,  Idaho,  and  Utah?  A.  They  do.  They 
shut  out  all  the  freights  on  goods  that  we  import.  We  import  from 
Milwaukee,  around  the  Horn,  by  sailing  vessels,  and  they  ship  the 
same  goods  and  shut  us  out  of  the  Montana  markets,  and  still  they 
charge  them  double  rates. 

Senator  Vrooman — That  has  been  remedied  by  competition  ?  A. 
Yes,  sir. 

Q.  If  we  could  encourage  them  to  come  here  we  would  have  the 
same  benefit,  would  we  not?  A.  Yes,  sir.  Would  you  expect  an 
opposition  bank  to  come  here  and  start  an  opposition  banking  busi- 
ness? There  is  no  room  for  another  road.  These  railroads  have 
every  merchant's  freight.     Who  are  they  to  get  patronage  from  ? 

Q.  After  a  time  they  would  get  freight?  A.  No  other  railroad 
would  come  here  unless  they  would  sign  a  special  contract  to  patron- 
ize them. 

Senator  Cross — How  long  do  these  special  contracts  last?  A. 
From  year  to  year.  They  generally  keep  a  little  balance  due  about 
that  time. 

_  Q.  Hasn't  there  been  an  attempt  made  to  break  through  this  spe- 
cial contract  system  by  the  North  Pacific  Railroad  Company?  A.  I 
had  an  agreement  with  the  traffic  manager  of  the  road,  and  I  called 
him  down  to  the  office  and  explained  to  him  that  he  would  have  to 


14 

keep  aloof  from  this  special  contract  system  regarding  freights,  and 
that  if  he  would  do  so  I  would  agree  to  give  him  one  hundred  thou- 
sand tons  of  freight  within  ten  days.  He  agreed  to  that,  and  went 
away  up  north,  and  within  ten  days  I  telegraphed  to  him  the  names 
of  the  parties  in  eveiy  kind  of  business — one  hundred  thousand 
tons  of  freight — and  it  was  agreed  that  he  would  keep  aloof  from  the 
special  contract  system.  These  merchants  were  willing  to  patronize 
the  road  and  take  the  goods  down  here  by  steamer  from  Oregon  in 
order  to  get  their  freedom;  and  the  Northern  Pacific  Railroad  Com- 
pany agreed  to  deliver  the  goods  in  San  Francisco,  without  a  special 
contract  system,  at  the  same  rates  or  as  cheap  as  they  were  delivered 
by  the  special  contract  system,  still  leaving  the  consignees  the  priv- 
ilege of  shipping  such  goods  as  they  chose  by  water. 

Senator  Del  Valle — You  say  that  the  contracts  between  the 
railroad  and  the  contractors  extend  over  one  37ear?     A.  Yes,  sir. 

Q.  Is  there  not  a  proviso  in  the  contract  that  the  railroad  company 
shall,  at  any  time  for  cause,  cancel  it?  A.  It  affects  those  four  pro- 
visions. 

Q.  They  are  the  sole  judges  of  that  matter?  A.  Yes,  sir;  they 
have  canceled  them  repeatedly. 

Senator  Brooks — Who  do  I  understand  you  to  say  that  you  had 
this  agreement  with  in  regard  to  the  Northern  Pacific  Railroad  Com- 
pany? A.  Mr.  Muir,  the  Traffic  Manager  of  the  road.  I  don't 
know  that  they  had  any  Secretary. 

Q..  Are  you  satisfied  that  the  Central  Pacific  Railroad  Company 
and  the  Southern  Pacific  are  the  same?  Is  there  any  lively  compe- 
tition between  them?     A.  I  don't  think  so. 

Q.  Have  you  any  reliable  information  on  that?  A.  The  very 
depreciation  of  the  stock  from  one  hundred  to  fifty  would  be  suffi- 
cient; all  that  was  the  bearing  of  the  stock. 

Senator  Cross — Do  I  understand  you  to  say  that  the  merchants 
in  other  places  than  San  Francisco,  in  California,  can  have  the  ben- 
efit of  the  same  special  contract  system?  Can  the  Sacramento  mer- 
chants have  their  freights  at  the  same  rates  from  the  East  as  the  San 
Francisco  people?    A.  Yes,  sir;  at  the  terminal  points. 

Q.  How  many  of  them?  A.  I  think  some  four.  The  original 
contracts  were  only  made  to  San  Francisco,  and  the  merchants  signed 
it  under  the  idea  that  they  were  to  have  some  protection,  but  since 
that  they  have  increased  the  places  and  taken  in  Stockton,  Los  Angeles, 
and  I  am  not  sure  whether  Marysville  or  not — I  know  Stockton,  Los 
Angeles  and  Sacramento.  We  have  lost  our  southern  trade,  and  the 
merchants  in  Sacramento  and  Stockton  import  directly  from  the 
East. 

Q.  That  is  to  say,  that  the  Stockton,  Los  Angeles,  Marysville,  and 
Sacramento  merchants  derive  a  profit  which  you  would  derive  if  it 
were  not  for  such  a  system?  A.  They  import  them  directly  because 
there  is  no  toll.     They  have  to  pay  no  San  Francisco  toll. 

_  Q.  Does  that  benefit  those  terminal  points  other  than  San  Fran- 
cisco? A.  I  don't  know  that  it  does.  San  Francisco  ought  to  be  the 
same  as  New  York.  It  ought  to  be  the  distributing  point  for  the 
Pacific  Coast,  and  we  merchants  should  get  goods  some  by  rail  and 
some  by  water,  and  we  should  have  all  the  principal  trade. 


15 

Q.  That  would  give  you  a  monopoly  of  the  business?  A.  Cer- 
tainly it  would  give  us  a  monopoly.  A  seaport  is  entitled  to  a 
monopoly.     That  is  what  has  made  San  Francisco. 

Senator  Reddy — Do  you  mean  that  you  are  entitled  to  the  advan- 
tages which  a  seaport  naturally  gets?     A.  Yes,  sir. 

Q.  You  are  entitled  to  a  monopoly  of  the  carriage  by  water? 
A.  Yes,  sir. 

Q.  That  is  a  monopoly  that  God  Almighty  created?  A.  Yes,  sir; 
under  his  own  hand. 

Senator  Whitney — Are  not  these  people  who  live  at  Sacramento, 
and  Los  Angeles,  and  those  other  places,  entitled  to  the  advantages 
which  a  railroad  gives  to  them?  A.  Not  at  the  expense  of  San 
Francisco. 

Senator  McClure — Don't  the  San  Francisco  people  complain 
that  the  railroad  gives  these  special  contracts  to  the  small  importers 
in  the  interior  towns  at  the  same  rates?  A.  Yes,  sir;  they  complain 
that  the  contracts  are  extended  into  the  interior  at  the  same  rates. 

Q.  They  refused  to  discriminate  between  a  large  importer  and  a 
small  one,  and  the  importer  on  Front  Street  complained  ?  A.  Yes, 
sir,  merchants  like  to  make  money.  It  is  a  matter  of  whether  they 
buy  in  New  York  or  buy  in  San  Francisco,  with  the  extra  freight 
added.  It  is  so  all  over  the  world.  San  Francisco  will  command  the 
trade,  the  business  of  the  State ;  you  can't  take  it  away  from  her, 
although  the  Central  Pacific  Railroad  has  tried  hard  to  do  it. 

Q.  Then  they  have  tried  to  distribute  the  wholesale  business  all 
over  the  State?     A.  No,  sir. 

Mr.  Whitney — Does  not  the  opening  of  roads  have  that  effect 
generally  upon  seaports?  A.  No,  sir;  simply  moved  the  freights 
from  the  distributing  points. 

Mr.  Cross — Is  freight  cheaper  now  than  it  was  before  the  railroad 
was  built?  A.  Freight  by  sailing  vessels  is  about  the  same ;  by  rail  it  is 
higher;  because  it  is  higher  than  a  sailing  vessel  or  steamer. 

Q.  Are  sailing  vessels  and  steamers  in  competition  against  rail- 
roads?    A.  No,  sir. 

Q.  If  they  were  permitted  to  come  in  and  go  out  freely,  would  not 
there  be  a  certain  amount  of  competition  between  the  ship  and  the 
railroad  company?  A.  Certainly,  there  would  be  a  natural  com- 
petition. 

Q.  Do  you  think  it  would  be  beneficial  to  shut  off  shipping  by 
entering  into  this  special  contract  system?  A.  Be  the  ruination  of 
the  State.  If  the  railroad  company  can  make  all  this  trouble 
importing,  what  would  they  do  with  exporting?  The  company 
would  own  everything.  Excuse  me,  but  what  in  the  devil  would 
there  be  left? 

Senator  Reddy — Do  you  see  anything  in  the  Barry  bill  which 
would  operate  injuriously  to  any  one  there?     A.  No,  sir. 

Q.  It  would  permit  certain  classes  of  goods  to  come  to  the  State  by 
water?     A.  It  throws  the  field  open  alike  to  everybody. 

Q.  Now  you  are  compelled  to  bring  all  classes  of  goods  by  rail  or 
else  pay  extra  rates?    A.  Yes,  sir,  or  they  shut  you  out  of  business. 

Q.  Then  the  matter  brought  up  by  Senator  McClure,  that  the  pres- 


16 

ent  contract  system  allows  the  poor  man  to  be  on  the  same  footing  as 
the  large  merchant,  would  be  precisely  the  same?  A.  Exactly;  there 
is  no  special  difference  in  it  that  I  can  see. 

Senator  Kellogg — If  the  goods  were  all  landed  in  San  Francisco 
in  the  first  instance  and  dealt  out  to  interior  merchants,  how  would 
that  change  affect  them?  A.  I  think  it  would  be  the  natural  pro- 
tection of  them.  I  think  that  large  houses  extend  protection  to 
small  dealers  in  the  natural  growth  of  trade;  it  is  so  recognized  all 
over  the  world.  The  large  dealers  in  London  deal  all  over  the  world. 
In  New  York  they  have  branch  houses  even  in  Chicago  and  else- 
where, and  it  is  natural  that  the  seaport  is  where  the  natural  gravi- 
tation of  commerce  comes,  and  in  this  case  it  ought  to  be  left  in  San 
Francisco. 

Q.  That  is  to  say,  that  large  importers  might  establish  branch 
houses  in  Marysville  and  monoplize  the  business?    A.  No;  no. 

Senator  Reddy — If  they  allowed  a  fair  rate  to  San  Francisco, 
and  from  there  to  other  points,  it  would  be  all  right?    A.  Yes,  sir. 

Q.  This  present  system  is  not  of  much  advantage  to  the  country 
merchants?  A.  No,  sir;  nothing  more  than  it  has  made  bad  feeling 
between  the  former  merchant  and  his  patron.  There  are  certain 
agricultural  implements  that  should  come  by  sailing  vessels.  We 
can  import  them  for  one  half. 

Senator  Sullivan — I  understand  that  all  these  other  towns  would 
have  the  benefit  by  allowing  the  merchants  of  San  Francisco  to  bring 
their  goods  by  sea?  A.  It  would  be  open  to  all  if  it  were  not  for  this 
special  contract  system. 

Senator  Cross — Would  there  be  any  wholesale  business  of  im- 
ported goods  in  these  towns  of  Stockton,  San  Jose,  Sacramento, 
Marysville,  and  Los  Angeles,  do  you  think,  if  it  were  not  for  this 
special  contract  system?  Does  not  the  special  contract  system  tend 
to  build  up  the  wholesale  business  in  those  cities?  A.  I  don't  see 
that  they  are  any  better  off  for  it.  I  don't  think  there  is  a  house  on 
the  northern  part  here  that  is  any  stronger  than  it  used  to  be  in  these 
places.  It  is  a  matter  of  whether  they  buy  in  New  York,  with  the 
extra  rate  added,  or  in  San  Francisco.  It  is  so  all  over  the  world. 
San  Francisco  will  command  the  business  of  the  State.  You  can't 
take  it  from  her,  although  the  Central  Pacific  Railroad  has  tried  to 
do  it. 

Q.  Then  they  havo  tried  to  distribute  the  wholesale  business  all 
over  the  State?     A.  Yes,  sir. 

Senator  Whitney — Does  not  the  opening  of  roads  generally  have 
that  effect  upon  seaports?  A.  No,  sir;  simply  moves  the  freights 
from  the  distributing  points. 

Q.  Is  it  not  an  indication  of  an  increase  of  commerce?     A.  No,  sir. 

Q.  I  have  heard  it  said  that  there  was  more  goods  pass  oyer  than 
passed  under  bridges  on  the  Mississippi  River;  would  you  be  inclined 
to  think  that  was  true?  A.  That  may  be  the  case.  Now,  to  get  our 
goods  round  the  Horn  ought  not  to  be  a  disadvantage  to  San  Fran- 
cisco, when  we  have  to  pay  an  average  of  from  forty  to  one  hundred 
by  rail.  With  San  Francisco  as  a  distributing  point  we  could  get 
our  goods  at  nine  dollars  a  ton  and  distribute  them  a  good  deal 
cheaper. 


17 

Q.  Railroads  do  make  new  distributing  points  ?     A.  Yes. 

Q.  The  building  of  railroads  about  Chicago  has  made  it  a  great 
city?     A.  Yes,  sir. 

Q.  And  it  would  not  have  been  without?  A.  Certainly,  the  com- 
pletion of  railroads  has  made  Chicago.  Not  one  railroad,  any  more 
than  it  would  San  Francisco.  Competition  is  what  we  want  here, 
and  whether  we  get  it  or  not  we  do  not  want  the  special  contract  sys- 
tem. 

Senator  Reddy — Do  you  know  of  any  reason  why  railroad  man- 
agement requires  the  merchant  to  enter  into  this  contract  not  to 
bring  freight  by  water?  A.  Because  they  want  to  control  the  entire 
carrying  trade  of  the  Pacific  Coast. 

Q.  Is  it  not  a  fact  that  they  get  the  merchant  to  enter  into  this  con- 
tract so  as  to  prevent  the  carrying  by  ships  ?    Exactly. 

Q.  And  so  that  they  may  get  higher  rates  than  they  had  before? 
A.  Yes,  sir. 

Senator  Spencer — I  understood  you  to  say  that  you  telegraphed 
the  names  of  several  gentlemen  from  San  Francisco  who  were  dis- 
satisfied with  the  special  contract  system  and  were  willing  to  ship 
by  the  Northern  Pacific  Railroad.  A.  I  telegraphed  one  hundred 
thousand  tons.     I  think  there  were  thirty  or  forty  names. 

Q.  How  many  of  them  were  in  the  special  contract  system?  A.  No 
contractors  except  two. 

Q,  Do  you  feel  that  you  would  violate  any  confidence  by  giving 
those  names?  A.  I  should  first  like  to  have  the  privilege.  Our  mer- 
chants are  very  cowardly.  I  don't  like  to  interfere  with  their  busi- 
ness, and  I  have  never  done  so,  but  if  you  want  to  examine  my  letter 
book  I  would  be  happy  to  allow  you  to  do  so. 

Q.  The  action  of  these  parties  was  partially  prevented  by  Gould 
and  Huntington  getting  control  of  the  Northern  Pacific  Railroad? 
A.  Yes,  sir. 

Q.  And  Muir  did  not  abide  by  his  contract?  A.  No,  sir.  He 
wrote  to  me  that  he  was  willing,  and  that  the  Directors  were  also,  to 
take  it  at  fifty  dollars  a  ton. 

Q.  Who  controls  the  Pacific  Mail  Steamship  Company?  A.  They 
control  it.  They  have  a  contract  or  pay  so  much  to  them  for  fixing 
the  rates. 

Q.  Will  the  Barry  bill  affect  that?  A.  In  the  Barry  bill  or  under 
it  they  cannot  afford  it.  If  they  can't  control  them  what  do  they 
want  to  make  the  rates  for. 


Statement  of  H.  M.  Yerrington. 

Mr.  Chairman  and  Gentlemen:  I  am  here  representing  the  Car- 
son and  Colorado  Railroad.  It  commences  in  Nevada  and  runs  a 
distance  of_  eighty-six  miles  in  the  State  of  Nevada  to  the  State  line 
of  California,  and  then  extends  one  hundred  and  seven  miles  in  this 
State.  I  came  down  here  with  the  view  of  going  before  the  Board  of 
Equalization  in  regard  to  taxes,  but  am  very  glad  to  meet  you  here 
in  regard  to  matters  which  I  understand  are  coming  up  in  relation 
2b 


18 

to  railroads  and  railroad  matters  in  our  section  of  the  State.  I  do 
not  understand  what  it  is  that  you  particularly  desire,  but  if  you 
have  any  questions  I  will  be  very  happy  to  answer. 

Senator  Reddy — Have  you  read  what  is  known  as  the  Barry  bill? 
Answer.  Yes,  sir;  a  portion  of  it. 

Q,  What  objections  are  there  from  a  railroad  standpoint  to  any 
section  of  that  bill?  A.  That  is  rather  difficult  for  me  to  answer  in 
reading  it  over  so  hastil}7.  There  are  a  great  many  points,  of  course, 
that  I  might  overlook.  The  only  thing  that  I  notice  is  the  classifi- 
cation of  the  rates  of  passenger  fares. 

Q.  That  would  not  come  into  the  Barry  bill.  Have  you  noticed 
section  one,  on  page  two,  where  it  reads:  "All  freight  shall  be  dis- 
patched and  forwarded  in  the  order  in  which  it  is  received  or  ten- 
dered for  transportation  (except  that  a  preference  may  be  given  to 
perishable  articles  and  to  express  matter  and  fast  freights).  Do  you 
see  any  objection  to  that?  A.  No,  I  do  not,  excepting  in  the  matter 
of  transferring  from  a  narrow  gauge  to  a  wide  gauge.  It  is  possible 
that  we  might  make  a  carload  in  less  quantity.  They  might  deliver 
to  us  one  of  fifteen  tons,  and  we  might  use  two  cars  instead  of  one. 
I  don't  know  as  that  would  be  an  injury,  so  long  as  we  did  not  injure 
the  goods. 

Q.  Now,  I  will  call  your  attention  to  section  two,  which  reads, 
"  All  persons  and  companies,  mentioned  in  the  first  section  of  this 
Act,  shall  at  all  times  keep  posted  in  a  conspicuous  place,  accessible 
to  the  public,  at  each  of  their  stations  and  offices,  a  printed  table  or 
schedule  of  all  rates  of  freights  and  charges  in  force  for  transportation 
between  all  points  and  stations,  to  or  from  which  they  carr}r,  and 
shall  furnish  (for  examination)  a  printed  copy  of  such  table  or  sched- 
ule to  all  persons  demanding  the  same."  Do  you  see  any  particular 
hardship  in  that?  A.  No,  sir,  I  do  not;  I  would  suggest  one  thing  that 
it  might  be  well  to  insert:  that  the  agent  be  allowed  to  write  in  any 
changes  that  might  be  made,  that  would  be  needed  in  the  freight 
that  might  come  to  the  agent's  office.  You  can  see  the  reason  for 
that. 

Q.  I  see;  a  new  class  of  freight  might  come  along,  and  by  being 
allowed  to  put  it  in,  he  would  avoid  the  violation  of  the  law  ?  A. 
Exactly. 

Q.  Have  you  any  objections  to  the  bill  as  a  whole?  A.  Well,  I 
understand  that  the  whole  bill  covers  the  proposition  of  operating 
roads. 

Q.  To  prevent  and  punish  discriminations.  Now->  that  being  car- 
ried out  according  to  its  spirit  and  letter,  with  a  view  to  preventing 
discrimination,  and  not  for  the  purpose  of  hurting  any  one  who 
wants  to  obey  the  law  and  to  prevent  discrimination  and  protect  the 
public,  can  you  see  any  sound  objection  to  that  bill?  A.  We  have 
had  cases  on  our  road  where  we  had  opposition  from  other  roads, 
and  the  result  was  that  we  had  to  deliver  goods,  say  at  some  certain 
point  on  our  road,  at  less  rates  than  we  would  deliver  them  at  another 
point.  If  that  would  be  discriminating,  it  would  be  a  good  thing 
for  the  parties.  We  could  run  against  the  other  railroad.  In  other 
words,  the  lack  of  discrimination  would  destroy  competition,  and  in 


19 

that  case  the  people  would  suffer,  but  aside  from  that,  I  do  not  see 
anything  objectionable — I  don't  see  any  reason  why  we  could  not 
run  under  this  bill. 

Q.  There  are  a  great  many  points  where  there  is  not  competition  ? 
A.  There  are  in  Nevada,  we  have  the  Nevada  Central  road,  and  it 
extends  within  sixty  or  eighty  miles  of  us.  and  that  is  where,  if  we 
cannot  discriminate,  we  cannot  compete,  if  both  rates  of  freights 
and  fares  were  the  same. 

Q.  Would  you  be  in  as  good  a  position  as  the  other  road — you 
would  have  the  same  advantages?     A.  That  is  true. 

Q.  So  that  things  would  probably  equalize  themselves?  A.  We 
admit  that. 

Q.  So  that  you  would  not  regard  this  bill  as  being  severe  upon 
the  parties  who  recognized  that  they  must  not  discriminate  ?  A.  No, 
I  do  not,  except  where  this  thing  is,  if  we  see  fit  to  run  the  road 
cheaper  than  the  other.  In  that  case  the  question  would  be,  whether 
we  would  be  allowed  to  do  so  under  the  law. 

Q.  If  the  same  general  rule  were  applied,  you  would  be  in  as  good 
position  as  the  others?    A.  No  doubt  about  that. 

Q.  The  other  fellow  might  want  to  take  advantage  of  you  as  well 
as  you  of  him,  but  if  the  law  did  not  allow  you  to  do  so,  it  would  be 
all  right?  A.  It  would  be,  so  far  as  the  road  is  concerned,  but  the 
customer  would  suffer  in  that  case  because  he  could  not  get  the  lower 
rates. 

Q.  Every  rule  will  work  a  disadvantage  to  somebody?    A.  True. 

Q.  And  in  determining  a  general  rule,  in  order  to  prevent  dis- 
crimination, we  cannot  of  course  be  guided  by  a  particular  instance 
where  it  would  benefit,  even  though  it  did  injure  a  single  individual? 
A.  Certainly. 

Senator  Vrooman — Will  you  please  read  the  bill,  commencing 
with  the  word  "  All,"  on  line  five  of  page  one,  down  to  the  close  of 
the  section,  and  see  what  you  think  in  regard  to  that  matter.  Now, 
under  the  reading  of  that  section  you  would  be  compelled  to  trans- 
port all  freights,  regardless  of  its  character,  over  the  whole  road, 
between  the  same  points,  in  the  same  direction,  at  the  same  price? 
A.  Do  you  mean  to  say  that  that  would  not  allow  us  to  classify  our 
good§  ? 

Q.  Yes,  sir. 

Senator  Cross — That  is,  lines  twelve  and  thirteen,  on  page  two, 
"  except  perishable  articles  and  fast  freight." 

[Discussion  omitted.] 

Q.  I  will  ask  you  to  read  line  nine,  and  ask  how  you  construe  that? 
A.  I  construe  it  that  we  would  have  no  right  to  classify  our  goods. 

Q.  If  you  were  to  insert  after  the  word  "another,"  on  line  nine,  "of 
the  same  class  of  freight,"  or  "of  the  same  kind  of  freight,"  or  "the 
same  classes  of  freight,"  wouldn't  the  bill,  with  that  amendment, 
prevent  discrimination,  and  at  the  same  time  allow  you  to  classify 
your  freight?     A.  I  think  so. 

Q.  Now  turn  to  line  eleven,  on  page  two.  How  long  is  your  road? 
A.  Nearly  three  hundred  miles. 

Q.  Through  what  kind  of  a  country  is  it  operated?  A.  Through  a 
mountainous  country,  principally. 


20 

Q.  What  is  the  general  character  of  your  business?  A.  Ores, 
machinery,  borax,  soda,  and  lumber. 

Q.  Do  you  ever  have  large  amounts  of  wheat  or  grain?  A.  We 
are  hauling  considerable  wood,  but  not  much  grain. 

Q.  Do  you  ever  have  a  large  amount  of  any  kind  of  freight,  more 
than  you  have  facilities  for  transportation  at  the  same  time  ;  I  mean 
nothing  more  than  you  could  move  in  a  few  days?  A.  No,  sir, 
unfortunately  not. 

Q.  Do  you  transport  much  live  stock?  A.  Very  little.  The  road 
runs  through  a  small  section  of  country;  Owen  Lake  Valley,  about 
sixty  miles.  It  is  very  light.  Our  business  is  principally  through  a 
mountainous  country,  and  for  mines. 

Q.  I  will  now  direct  your  attention  to  line  five  in  section  two ;  how 
do  you  construe  that  portion  which  reads,  "And  shall  furnish  a 
printed  copy  of  all  such  tables  or  schedules  to  all  persons  demanding 
the  same."  Under  the  wording  of  that  line,  would  you  or  would  you 
not  hold  that  you  would  have  to  furnish  a  patron  of  your  road  with 
a  copy  of  the  schedule  all  the  way  to  San  Francisco?  A.  No,  sir; 
that  ought  to  apply  only  to  points  on  our  road. 

Q.  Would  it  not  be  well  to  amend  that  in  some  respects,  so  as  to 
make  it  clear?  A.  The  difficulty  would  be  to  get  the  same  rates ;  the 
rates  being  on  different  roads,  it  is  difficult  for  us  to  tell ;  we  would 
have  to  ascertain  what  we  could  do  beyond  where  our  road  com- 
menced. 

Q.  You  mean,  then,  that  there  is  no  objection  to  keeping  posted  in 
your  offices  and  stations  a  printed  schedule  of  the  fares  and  freights 
from  that  station  to  other  points  along  your  own  road  within  the  State? 
A.  I  see  no  objection  to  that.  I  would  like,  though,  to  suggest  to  you 
the  same  thing  that  I  did  to  Mr.  Reddy,  and  that  is,  that  the  agent 
should  be  allowed  to  interline  or  write  in  any  changes  that  might  be 
made  in  the  schedule,  the  printed  schedules. 

Q.  If  you  had  a  printed  schedule,  and  subsequently  a  new  indus- 
try should  spring  up  along  the  line  of  your  road  that  was  entirely 
new,  you  would  wish  to  interline  that  in  the  schedule?  A.  That  is 
the  idea. 

Q.  You  could  have  it  so  that  it  migh.t  be  interlined,  so  that  the 
new  rates  might  be  put  upon  the  schedule?  A.  The  rates  constantly 
change  in  freighting. 

Q,.  How  long  is  your  road?    A.  About  three  hundred  miles. 

Q.  And  through  a  sparsely  settled  country?     A.  Yres,  sir. 

Q.  How  many  trains  do  you  run  every  day  over  your  road  ?  A. 
Two  mixed  trains.  The  passenger  and  freight  are  all  on  one  train  ; 
one  each  way  each  day. 

Q.  About  how  many  cars  do  you  run?    A.  From  three  to  eight. 

Q.  You  have  a  small  road,  doing  a  limited  amount  of  business? 
A.  Yes,  sir,  we  have. 

Q.  With  that  small  road,  and  doing  that  limited  amount  of  busi- 
ness, how  many  times  during  the  year  do  you  change  your  freight 
schedule?  A.  We  probably  would  not  change  our  freight  schedule 
more  than  once. 

Q.  How  many  times  do  you  have  occasion  to  change  it  by  adding 


21 

to  it  and  taking  from  it?  A.  Almost  every  day.  Our  freight  agent 
does  that  by  writing- a  note  to  the  agent  at  the  station  that  it  is  going 
from  or  going  to,  explaining  what  he  is  going  to  do  about  making 
the  change.  But  we  have  a  law  in  the  State  of  Nevada  that  we  have 
to  give  five  days'  notice  that  we  propose  making  a  change,  and  con- 
sequently you  will  understand  where  the  trouble  comes  in  about  this 
sort  of  thing.     It  is  a  very  necessary  thing  for  him  to  do. 

Q.  Assuming  that  you  had  a  long  road  and  were  running  a  great 
man}'  freight  trains  a  day  over  it,  of  course  upon  the  same  proposi- 
tion you  would  change  your  schedule  very  often,  that  is  in  the  way 
of  adding  to  it  and  taking  from  it  ?     A.  Yes,  sir. 

Senator  Brooks — On  page  two,  of  line  four,  what  is  your  opinion 
in  reference  to  that  provision,  "  All  railroad  corporations  must  at  all 
times  keep  their  tracks  and  other  structures  in  good  and  sufficient 
repair,"  etc.?  A.  Well,  of  course  that  refers  to  bridges  and  things 
of  that  kind,  naturally  taking  in  the  bed  of  the  road  and  the  ties. 
If  the  road  is  properly  managed  and  it  is  necessary  to  keep  those 
things  in  good  order,  there  wTould  be  no  objection  to  that.  If  they 
are  destroyed,  of  course  they  would  have  to  be  repaired.  If  they  are 
removed,  there  must  be  some  good  reason  if  they  are  not  put  back 
there  again.  I  don't  understand  the  necessity  of  that  word  "  remove  " 
in  there. 

Q.  You  would  suggest,  then,  that  the  word  "remove"  be  stricken 
out?     A.  Entirely.     I  don't  see  any  sense  in  it. 

Q.  In  section  seven,  line  five,  "Any  agent,  officer,  or  servant  of 
the  company,  who  shall  take  part,"  etc.,  what  effect  would  that  have? 
A.  My  impression  is  that  it  would  be  very  difficult  to  find  out  how  it 
was  done  or  when  it  was  done. 

Q,.  Would  it  be  hard  upon  the  agents  or  employes  of  the  road  ? 
A.  It  would  be,  if  carried  out  strictly.  The  chances  are  that  we 
would  not  have  agents.  That  is  a  section  that  I  have  not  read 
before. 

Senator  Del  Valle — I  want  to  ask  you  again  about  your  con- 
struction of  line  five  of  section  one,  "All  persons  and  companies 
engaged  in  operating  any  such  road,  or  in  transporting  freight  or 
passengers  over  the  same,  or  which  shall  hereafter  operate  or  charge 
as  aforesaid,  shall  forward,  move,  and  carry  impartially  for  all  per- 
sons offering  freight  to  be  transported  or  moved,  without  discrimina- 
tion, preference,  or  favor  to  one  over  another,"  etc.  Does  not  that 
refer  to  persons  and  not  to  things?  A.  I  don't  think  so.  I  think 
under  that,  if  a  man  came  in  to-day  with  a  carload  of  silks,  and 
another  with  a  carload  of  potatoes,  and  the  fellow  who  had  the  silks 
would  say,  "  I  want  you  to  ship  this  at  the  same  rate  that  you  ship 
the  potatoes  at,"  you  would  have  to  do  it.  (Reading  it  again.)  It 
seems  to  me  that  it  is  very  plain. 

0-  That  it  means  that  the  prices  should  be  the  same  for  all  kinds 
of  freight?     A.  Yes,  sir. 

Q.  You  don't  mean  that  if  one  had  a  carload  of  potatoes,  and 
another  a  carload  of  something  else,  that  you  should  charge  one  fifty 
dollars  and  the  other  seventy-five  dollars?  A.  No,  sir.'  It  means 
that  all  should  be  entered  at  the  same  price;  but  it  seems  to  me  that 


22 

if  you  would  put  in  "  of  the  same  clais,  or  character,"  or  something 
of  that  kind,  that  would  avoid  it. 

Q.  In  regard  to  this  difference  in  prices,  why  do  you  say  that  there 
should  be  a  difference  in  price?  A.  It  says  here,  "no  preference 
over  another  in  price." 

Q.  Over  another  what?    A.  Over  another  shipper. 

Q.  It  does  not  read  freight,  does  it?    A.  No,  sir. 

Senator  Spencer,  of  Napa — Reading  page  two,  beginning  at  line 
eleven,  and  down  to  line  fourteen:  "All  discounts,  rebates,  special 
contracts,  special  rates,  and  other  devices  for  charging  more  or  less 
than  such  published  rates,  are  forbidden;  provided,  that  a  uniform 
discount  (to  be  established  and  published  as  aforesaid  for  payment  in 
advance,  or  for  prompt  payment)  may  be  made,  and  different  rates 
may  be  charged  for  express  matter,  fast  and  slow  freights,  and  for 
carload  lots  and  lots  under  a  carload,  all  such  rates  and  discounts  to 
be  available  to  all  applicants  on  equal  terms."  Is  there -any  objec- 
tion against  that  sentence?  A.  I  don't  see  that  there  is.  I  suppose 
that  it  means  that  it  shall  be  shipped  as  it  is  received. 

Q.  That  is  the  general  rule  with  reference  to  other  business,  is  it 
not — "first  come,  first  served?"  "All  freight  shall  be  dispatched  in 
the  order  in  which  it  is  received  or  tendered  for  transportation, 
except  that  a  preference  may  be  given  to  perishable  articles,  and  to 
express  matter,  and  fast  freight."  Is  that  proper,  in  your  judgment? 
A.  Yes,  sir. 

Q.  Supposing  that  I  bring  a  load  of  fruit,  and  Mr.  Del  Valle  brings 
another  load  of  oranges,  and  another  Senator  brings  another  load — 
all  perishable.  Supposing  I  bring  mine  to-day,  Mr.  Del  Valle  brings 
his  to-morrow,  and  Senator  Brooks  the  next  day;  do  you  think  it 
would  be  fair  for  you  to  take  up  Senator  Brooks'  car,  that  came  last, 
and  send  it  first?  A.  If  I  followed  the  law  in  the  first  place,  his 
would  not  be  there  when  the  other  came. 

Q.  If  an  amendment  be  put  in  there  that  articles  of  freight  shall 
be  carried  in  the  order  in  which  they  are  received,  "of  the  same 
class  or  kind,"  does  not  that  take  it  out  of  the  rule  that  all  freight 
shall  be  carried  in  the  order  in  which  it  is  received.  And  don't  that 
give  to  the  railroad  company  the  perishable  articles  which  they 
receive  first  to  carry  first?     A.  As  between  shippers? 

Q.  Yes,  sir.  Don't  that  obviate  the  very  necessity  that  is  appar- 
ently intended  to  be  cured  by  the  bill?  A.  I  will  explain  that. 
Taking  our  mixed  freights,  our  trains  are  made  up  of  fast  freight, 
slow  freight,  express,  and  passenger.  Now,  supposing  that  one  had  a 
lot  of  machinery,  and  another  a  lot  of  oranges,  and  one  a  lot  of  per- 
ishable fruit,  and  a  lot  of  express,  and  all  that.  Under  this  bill  it  says 
that  they  shall  be  dispatched  in  the  order  in  which  they  are  received; 
without  it  we  would  have  the  right  to  leave  the  machinery  and  take 
the  oranges  or  the  melons,  and  leave  the  machinery  till  the  next 
train  could  come  and  take  them.  That  would  be  an  answer  to  you,  it 
would  seem  to  me.  This  bill  says  that  each  carload,  as  it  comes  in, 
no  matter  to  whom  it  belongs,  should  be  sent  forward  immediately. 
If  another  carload  comes  that  day,  the  one  that  comes  to  you  first 


23 

should  be  sent  first.  That  is  what  I  understand  this  law  means, 
does  it  not  ? 

Q.  Do  you  mean  to  say  that  if  I  bring  you  a  carload  of  potatoes, 
or  a  carload  of  wheat,  and  another  person  at  the  same  time  brings 
you  a  carload  of  perishable  fruit,  that  this  bill  does  not  give  the  car- 
load of  fruit  the  preference  ?    A.  That  is  the  way  I  read  it. 

Q.  Don't  this  expressly  give  the  railroad  company  the  right  to 
discriminate  between  persons  that  ship  perishable  articles?  Don't 
it  read  so  that  it  cannot  discriminate  in  that  freight?  To  cut  it 
short — that  there  shall  be  no  discrimination  between  persons  as  to 
classes  of  goods?    Do  you  see  the  point  ?    A    I  see  the  point ;  yes,  sir. 

Q.  Is  it  nothing  more  than  fair  that  the  railroad  company  should 
serve  first  the  man  who  comes  first?    A.  Not  at  all. 

Q.  Especially  perishable  fruit;  the  man  who  brings  perishable 
fruit  first  should  have  it  sent  first?    A.  Yes,  sir. 

Senator  Sullivan — You  say  that  this  road  runs  between  Nevada 
and  California?     A.  Yes,  sir. 

Q.  In  what  States  has  it  been  incorporated  ?  A.  It  runs  from  the 
Mountain  House  down,  about  half  way  from  Carson,  to  Virginia  City, 
in  a  southwesterly  direction  one  hundred  and  fifty-eight  miles, 
and  then  runs  about  thirty- five  miles  to  the  State  line  of  the  State  of 
California.  To  the  junction,  the  first  portion  of  the  road,  is  incor- 
porated in  the  State  of  Nevada  as  the  Nevada  and  California  road; 
and  from  the  junction  to  the  State  line,  the  Carson  and  Colorado  sec- 
tion, the  second  division.  Then  we  come  to  the  State  line  of  Cali- 
fornia and  run  one  hundred  and  seven  miles.  That  is  the  terminus 
of  our  road.  We  call  that  the  Carson  and  Colorado,  third  division, 
and  that  is  incorporated  in  the  State  of  California. 

Q.  Your  road  is  a  narrow  gauge  road  ?    A.  Yes,  sir. 

Q.  A  standard  narrow  gauge?    A.  Yes,  sir. 

Q.  Similar  to  the  gauge  of  the  South  and  the  North  Pacific  Coast 
roads  ?    A.  Yes,  sir. 

Senator —Supposing  that  you  should  have  occasion  to  remove 

a  depot  permanently  because  the  travel  did  not  warrant  you  in  retain- 
ing it,  or  supposing  that  it  should  be  destroyed  by  fire  and  you  should 
desire  to  replace  it  at  some  other  point  on  the  line  that  you  thought 
would  be  more  convenient  for  a  depot  than  the  one  where  it  had 
originally  stood,  wouldn't  you,  under  the  last  clause  of  section  three, 
be  compelled  to  replace  it  exactly  where  it  originally  stood,  or  very 
near  to  it  ?  A.  Yes,  sir;  I  think  so.  It  would  look  that  way.  I  was 
looking  at  this  before.  In  speaking  about  this  I  had  reference  to 
tracks  and  bridges,  but  not  to  buildings.  I  supposed  that  structures 
meant  bridges,  and  I  said  that  a  company  should  keep  the  road  in 
good  order,  so  as  to  be  open  at  all  times.  "They  must  at  all  times 
maintain  all  their  track  and  other  structures  in  good  and  sufficient 
repair  and  in  a  state  of  complete  efficiency  for  the  purposes  for 
which  they  were  constructed  or  adopted.  Any  such  structure 
decayed,  destroyed,  or  removed,  must  be  diligently  replaced  or 
restored  to  as  good  or  better  condition  of  usefulness  and  efficiency 
as  before  such  decay  or  removal."    Then  that  would  be  buildings. 


24 

That  would  prevent  us  from  removing  a  station  to  any  distance  from 
where  it  was  at  the  time  it  was  destroyed. 

Q.  If  the  section  read  that  you  were  to  keep  open  and  in  good 
repair  a  continuous  track,  you  would  have  no  objection  to  it?  A. 
That  is  the  idea. 

Senator  Reddy — Would  you  not  consider  that  under  this  bill  you 
would  have  to  rebuild  a  depot  in  the  same  position  where  it  had 
hitherto  been,  even  though  both  the  interest  of  the  traveling  public 
as  well  as  the  interest  of  the  railroad  company  would  not  be  dam- 
aged by  discontinuing  it  entirely,  or  by  putting  it  in  another  place? 
A.  I  will  tell  you  what  I  would  do  :  If  I  wanted  to  remove  a  station 
on  our  road,  I  would  go  and  do  it,  and  if  any  one  came  to  me  and 
said,  "You  are  to  put  this  where  it  originally  stood,"  I  would  say,  "  I 
will  replace  it,"  simply,  unless  the  term  "  replacing"  would  mean  put- 
ting back  where  it  originally  stood. 

Q.  Supposing  that  the  conditions  of  your  business  were  such  that 
it  would  not  justify  you,  as  a  business  proposition,  to  replace  it ;  sup- 
pose (as  was  suggested  by  Senator  Whitney)  that  it  was  a  mining 
camp  that  was  worked  out  and  all  the  people  had  gone  away,  would 
not  you  consider  that,  under  this  section,  you  would  have  to  replace 
it?  "A.  I  should  think  I  would  have  to. 

Q.  Would  you  not  think  that  would  work  a  hardship  to  the  com- 
pany without  any  corresponding  benefits  to  the  traveling  public  ? 
A.  It  would  be. 

Senator  Johnson — In  your  judgment,  as  a  railroad  man,  would 
the  words  "perishable  articles"  include  live  stock?  A.  That  would 
depend  upon  circumstances.  If  I  had  live  stock  to  send,  and  they 
were  at  a  station  where  they  could  not  get  water,  or  where  I  could 
not  take  them  out  and  feed  them,  I  would  feel  obliged  to  forward 
them  as  soon  as  possible  as  against  any  other  ordinary  freight. 

Senator  Vrooman — And  if  you  could  get  water  and  feed?  A.  If 
I  could,  then  I  would  take  oranges,  or  fruit,  or  provisions  in 
preference. 

Q.  Then  live  stock,  with  plenty  of  feed  and  water,  would  be  classi- 
fied with  coal  and  iron  and  wood,  and  that  kind  of  freight?  A.  No; 
not  exactly.     I  would  put  them  ahead. 

Q.  How' could  you,  if  you  are  to  be  governed  by  the  doctrine  of 
perishable  and  non-perishable  articles  under  this  bill?  A.  The  ques- 
tion is,  if  an  ox  had  plenty  of  feed  and  water,  how  long  would  it  take 
him  to  perish? 

Q.  But  he  would  eat  his  head  off?  Now  direct  your  mind  to  this 
proposition:  does  this  bill  provide  for  any  more  than  two  classes  of 
freight,  non-perishable  and  perishable?    A.  That  is  all,  of  course. 

Q.  Then  live  stock,  I  understand  you,  if  they  had  plenty  of  food 
and  water,  would  not  be  considered  perishable?     A.  No,  sir. 

Q.  Then  if  you  had  a  carload  of  ores  to  transport,  and  a  man 
came  along  with  a  few  head  of  cattle,  which  would  have  the  prefer- 
ence under  this  bill?    A.  The  cattle. 

Q.  How?     A.  They  are  more  perishable  than  ore. 

Q.  But  it  does  not  seem  to  make  any  distinction  in  the  bill?     A. 


25 

That  would  have  to  be  one  of  the  cases  that  would  have  to  be  left  to 
the  railroad  company,  of  course. 

Q.  This  bill  does  not  propose  to  leave  anything  to  the  railroad.  It 
says  you  must  not  make  any  distinction  except  in  regard  to  per- 
ishable goods?  A.  It  would  have  to  be  left  to  the  railroad  company, 
as  I  understand  it. 

Q.  As  to  non-perishable  articles,  it  does  not  make  any  distinction? 
A.  No,  it  does  not. 

Senator  Whitney — Is  it  not  frequently  the  case  that  the  railroad 
companies  have  to  exercise  a  discretion  in  such  matters  as  cattle. 
Suppose  a  family  of  immigrants  were  coming  along  with  their  house- 
hold goods,  and  that  you  had  two  or  three  hundred  tons  of  ore  to 
transport,  don't  you  feel  as  though  it  would  be  your  duty  to  trans- 
port the  household  goods?     A.  Yes,  sir. 

Q.  And  yet  there  is  nothing  mentioned  about  that  in  this  bill? 
A.  My  judgment  about  that  is  that  the  bill  is  possibly  intended  for 
people  who  have  not  got  any  souls  or  hearts,  or  anything  of  the  kind, 
and  in  that  case  I  would  make  it  as  binding  on  them  as  possible.  I 
want  to  do  business  so  that  if  a  poor  man  comes  along  with  his  goods 
we  would  try  to  let  him  get  them  on,  and  let  the  perishable  stock 
hold  over.  And  if  we  have  a  man  that  we  don't  like,  we  do  it 
quicker  for  him  than  for  anybody  else,  to  show  that  there  is  nothing 
mean  about  our  people.     That  is  the  way  that  we  do  business. 

Q.  Now.  I  want  to  know  what  you  understand  that  word  "accom- 
modation "  to  mean  ?  A.  There  might  be,  for  instance,  express  freight 
which  ought  to  go  over  the  road  quicker. 

Q,.  Does  that  have  reference  to  the  cars  or  the  accommodation  fur- 
nished? A.  I  don't  know  that  that  term,  as  used  here,  would  have  a 
particular  meaning. 

Q.  It  don't  mean  anything?     A.  That  is  about  it. 

Q.  Does  not  that  mean  by  box  cars,  or  flat  cars,  or  things  of  that 
sort?  A.  The  railroad  company  might  possibly  know  about  such 
things.  A  man  might  not  want  his  goods  to  go  on  a  flat  car.  I 
would  not  want  a  party  to  ship  goods  on  a  flat  car  if  he  had  to  take 
any  chances  on  rain,  or  something  of  that  kind;  but  I  don't  under- 
stand exactly.  If  we  shipped  the  goods  as  they  arrived,  that  is  all  we 
could  do.  I  don't  know  any  other  accommodations  that  we  could 
-give. 

Q.  You  don't  know  what  the  word  "accommodation"  does  mean 
there?     A.  No,  sir;  I  don't  know  what  it  means. 

Senator  Kellogu — In  connection  with  the  question  asked  you  by 
the  gentleman  in  regard  to  household  goods,  I  understood  you  to  say 
that  if  the  law  was  fixed  in  that  way  that  you  would  not  pay  much 
attention  to  it?  A.  No;  because  we  do  those  things  without  law 
asking  us  to  do  it. 

Q.  But  if  this  bill  was  in  force  you  would  not  be  allowed  to  do  ft, 
or  you  would  lose  your  charter?  A.  That  refers  to  something  else 
brought  up  here. 

Senator  Reddy — That  is  a  legal  question,  that  if  he  fails  to  obey 
he  would  lose  his  charter?  A.  1  think  there  would  be  no  doubt 
about  that. 


26 

Q.  I  understand  that  that  would  be  your  idea  in  regard  to  the  bill? 
A.  Yes,  sir. 

Senator  Baldwin — Don't  you  think  it  would  be  complying  with 
the  spirit  of  the  law  if  you  were  to  forward  the  band  of  cattle  before 
you  did  the  ore?  A.  As  I  said,  I  should  feel  very  much  like  doing 
that.     It  is  the  humane  way  of  doing. 

Q.  Don't  you  think  it  would  be  a  compliance  with  the  spirit  of  the 
law?    A.  Well,  I  presume  that  would  be  the  result. 

Q.  If  you  complied  with  the  spirit  of  the  law,  would  not  you  be 
following  the  law?  A.  I  don't  find  any  fault,  and  I  don't  think  if  I 
did  so,  that  I  could  be  sued  in  any  Court  in  the  country  and  they 
could  get  a  verdict  from  any  Judge  and  jury. 

Senator  Vrooman —  I  call  your  attention  again  to  the  words  "  or 
accommodations,"  as  suggested  by  Senator  Whitney,  and  ask:  Sup- 
posing that  Mr.  A  brings  a  ton  of  ore,  and  you  put  it  on  a  box  car,  or 
on  a  fiat  car,  and  Mr.  B  brings  a  ton  of  flour,  and  you  put  it  in  a  box 
car;  would  not  A,  under  the  reading  of  this  bill,  say,  "You  are  discrim- 
inating against  me;  you  have  got  the  ore  in  a  box  car.  and  the  flour 
on  a  box  car,  and  I  don't  like  it?"  A.  The  railroad  company  have 
to  handle  the  goods,  and  if  they  injure  any,  they  are  liable  for  the 
damage.  But  this  bill  describes  the  method,  and  says  price,  dispatch, 
speed,  or  accommodation.  Now,  of  course  the  words  are  to  be  given 
some  meaning  in  law,  if  possible.  I  say,  as  I  said  to  this  gentleman, 
I  don't  understand  the  words  "or  accommodations,"  and  I  don't 
understand  why  it  was  put  in. 

Q.  It  has  a  technical  meaning,  and  is  presumed  to  be  used  in  the 
law  in  a  technical  sense?  A.  Supposing  the  man  with  the  potatoes 
says,  "  Here,  I  want  you  to  accommodate  me,"  and  the  man  with  the 
flour  says,  "I  want  you  to  accommodate  me."  Now,  I  ship  the  flour 
in  a  box  car,  and  the  potatoes  on  a  flat  car,  and  I  say,  "  I  have  accom- 
modated you." 

Q.  Wouldn't  that  be  governed  by  the  word  "dispatch?"  A.  No, 
"dispatch"  means  forwarding  freight. 

Q.  Does  not  the  word  "speed"  cover  that.  Does  not  the  word 
"dispatch"  govern  the  starting  of  freight?    A.  That  is  what  I  mean. 

Q.  Don't  the  word  "  speed  "  mean  (reading  the  section),  first,  that  you 
shall  forward  it  in  the  order  in  which  it  is  received;  second,  trans- 
port it  on  the  same  time  one  with. another;  and,  third,  that  you  shall 
afford  to  every  shipper  the  same  kind  of'  accommodations  as  to 
character  of  car,  without  reference  to  the  class  of  freight.  Now,  are 
not  those  ideas  embodied  there  ?  A.  As  a  general  proposition,  that 
is  true,  although  I  may  say  this,  that  on  the  Virginia  and  Truckee 
Railroad  we  are  hauling  ore  on  a  steep  grade,  and  we  have  cars  pur 
posely  for  those  ores,  and  if  a  man  should  come  to  me  and  say, 
"I  want  you  to  put  this  ore  in  some  different  car,"  if  we  were  acting 
under  this  bill,  I  should  refuse  to  do  so. 

Q.  Do  you  then  give  him  the  same  accommodations?  A.  I  would 
give  him  the  same  cars  that  I  did  his  neighbor. 

Q.  In  other  words,  you  would  give  the  same  kind  of  accommoda- 
tions to  people  having  the  same  kind  of  freight  to  transport?  A. 
Yes,  sir. 


27 

Q.  Then  you  would  not  give  him  the  same  accommodations  as  you 
would  others,  as  to  the  character  of  the  car?    A.  No,  sir. 

Senator  Reddy — Would  you  put  flour  on  a  flat  car  and  wood  in 
a  box  car?     A.  No,  sir. 

Q.  Flour  being  a  perishable  article  if  exposed  to  the  action  of  the 
elements?  A.  I  don't  know  but  what  I  might,  possibly,  provided 
that  I  had  no  other  cars  in  the  yard  at  all  but  those  two. 

Q.  Both  parties  arriving  at  the  same  time,  could  A,  under  the  pro- 
visions of  this  Act,  demand  that  his  car  should  be  forwarded  first? 
A.  It  would  look  very  much  that  way. 

Q.  Couldn't  the  railroad  company  excuse  discrimination  in  favor 
of  one  over  another  in  that  way  or  by  that  means?  A.  I  think  so, 
although  if  perishable  articles  are  to  go  first,  I  suppose  as  far  as  flour 
is  concerned,  that  it  would  be  considered  a  perishable  article. 

Q.  I  believe  that  it  was  intimated,  by  the  Senator  from  Alameda, 
that  you  could  not  forward  any  freight,  under  this  bill,  till  the  sched- 
ule had  been  printed.  Do  you  find  anything  there  that  prohibits 
the  forwarding  of  freight  before  the  schedule  is  printed?    A.  No. 

Q.  Supposing  that  it  merely  says  that  you  shall  furnish  people,  for 
examination,  a  schedule,  and  that  some  new,  unclassified  freight 
should  arrive  for  which  no  rates  had  been  fixed  ;  now,  being  required 
to  print,  you  know,  as  a  business  man,  do  you  not,  that  when  a  man 
is  required  to  do  a  given  thing,  that  the  law  alwa37s  allows  him  a 
reasonable  time  to  do  it  in,  unless  the  time  is  mentioned ;  conse- 
quently I  assume  that  you  would  do  so  as  a  business  man  in  endeav- 
oring to  comply  with  the  law;  and  being  permitted  to  interline  or 
put  down  the  rate  in  writing,  would  you  not  have  a  reasonable  time 
to  classify  and  fix  the  rate,  in  your  judgment;  would  you  act  upon 
that  principle,  as  a  business  man,  if  the  law  did  not  make  any  abso- 
lute prohibition  of  any  kind?     A.  I  suppose  not. 

Q.  Would  you  not  consider  yourself  following  the  law  by  taking  a 
reasonable  time  to  comply  with  it  ?     A.  Certainly  not. 

Q.  You  are  willing  to  abide  by  the  law  in  the  management  of  that 
railroad?    A.  Exactly. 

Q.  As  a  business  man,  do  you  see  anything  in  this  bill  that  would 
prevent  you  from  operating  your  road,  or  which  would  seriously 
embarrass  you  in  the  management  of  your  road — I  mean  within  the 
spirit  of  the  law,  acting  under  the  proposition  that  there  is  to  be  no 
discrimination  in  the  forwarding  of  freight  or  the  dispatch  of  it ;  and 
without  taking  a  hypercritical  or  technical  view  of  the  bill,  but  look- 
ing at  the  whole  face  of  it,  would  you  say,  as  a  business  man,  that 
you  would  be  embarrassed  in  the  operating  and  management  of  your 
road  by  that  bill ;  that  is  to  say,  would  you  be  prevented  from  dis- 
criminating, and  would  that  be  a  hardship,  or  would  it  create  any 
serious  obstacle?    A.  I  don't  discover  anything  of  that  kind. 

Q.  Of  course  you  see  a  great  many  things  that  you  would  like  to 
alter?  A.  Excepting  some  of  these  matters  regarding  what  I  have 
read  here  to-day,  I  believe  the  wording  of  the  bill  in  some  places  is 
a  little  dark.  Section  one,  line  five,  that  you  "shall  forward,  move, 
and  carry." 


28 

Q.  That  is  what  you  are  doing-,  and  really  you  could  do  a  good  deal 
more  than  you  are  doing?     A.  Yes,  sir. 

Q.  You  forward  it  as  fast  as  any  reasonable  man  would  desire?  A. 
Yes,  sir. 

Q.  The  probabilities  are  that  you  will  do  that  for  all  of  it?  A. 
Yes,  sir. 

Q.  You  have  no  apprehension  that  you  will  be  crowded  by  cattle, 
or  ores,  or  coal,  or  anything  that  you  are  likely  to  get?  A.  No  doubt 
of  that. 

Q.  I  ask  you,  as  a  railroad  man,  if  it  is  not  the  desire  of  all  railroad 
companies  that  their  business  shall  increase?    A.  Always. 

Q.  Would  it  not  be  a  prudent  railroad  man's  business  to  say  that 
he  is  ready  to  forward  all  freight?    A.  Yes,  sir. 

Q,  And  should  he  not  do  it?  Does  he  not  owe  that  duty  to  the 
public?     A.  Yes,  sir. 

Q.  Do  you  find  anything  on  that  branch  in  it  that  would  prevent 
you  from  operating  your  road  and  forwarding  freight  as  it  comes? 
A.  No,  sir. 

Q.  Have  you  heard  any  complaint  against  your  company  because 
they  would  not  take  and  forward  all  freight  ?  A.  No,  not  to  my 
knowledge. 

Q.  The  railroads  are  not  oppressed  there  by  cattle  or  swine,  or  in  a 
general  way  by  live  stock  or  any  other  kind  of  freight.  The  trouble 
is  that  they  cannot  get  enough  ?    A.  That  is  the  trouble. 

Q,  Do  you  apprehend  any  great  trouble  in  the  future  on  the  part 
of  the  railroads  accommodating  the  people  with  their  freight? 
A.  No,  sir;  I  do  not. 

Q.  There  is  nothing  to  apprehend  on  that  score,  in  your  judg- 
ment?    A.  That  seems  to  be  the  case. 

Q.  You  shall  "forward,  move,  and  carry,  impartially."  If  all 
persons  offering  freight  to  be  transported  can  be  accommodated,  there 
can  be  no  trouble  there?    A.  No;  not  at  all. 

Q.  They  might  like  to  discriminate,  because  almost  every  man 
likes  to  serve  his  friend  first,  but  not  being  permitted  by  the  law, 
it  might  hurt  some  of  your  friends,  and  might  not.  That  would  not 
bother  the  railroad  company  at  all?     A.  Not  at  all. 

Q.  It  would  only  bother  those  people  who  are  friends  of  the  rail- 
road? •  A.  Thatis  all. 

Q.  You  would  not  be  allowed  to  discriminate?  A.  Except  in  this 
instance  we  will  be  able  to  discriminate :  the  company  could  as  against 
a  poor  man,  because  it  would  enable  him  to  ship  his  goods  and  get 
back  freight. 

Q.  You  assume  that  in  some  cases  the  railroad  company  should 
be  permitted  to  discriminate?     A.  Yes,  sir. 

Q.  But  it  would  not  prevent  any  company  from  operating  their 
road  if  it  denied  them  that  right?    A.  Not  at  all. 

Q.  Is  it  not  an  awful  power  to  be  placed  in  the  control  of  the  rail- 
road company  to  be  allowed  to  discriminate  between  persons.  Does 
it  not  put  it  in  their  power  to  destroy  any  individual  in  the  com- 
munity where  the  people  are  all  served  by  one  road?  A.  Well,  that 
is  true. 


29 

Q.  It  is  an  awful  power,  isn't  it?  A.  Yes,  sir;  but  I  don't  think 
the  railroads  want  to  destroy  any  one. 

Q.  Don't  they  destroy  communities?     A.  No,  sir. 

Q.  But  if  they  take  a  notion  to  do  so  they  can  injure  them  seri- 
ously? A.  Yes,  sir;  but  it  is  against  the  interest  of  any  railroad 
company  to  do  it. 

Q.  Then  it  would  not  do  them  any  harm  to  deny  them  that  right? 
A.  No. 

Q.  It  would  do  them  no  harm  from  being  prevented  from  doing 
what  they  do  not  want  to  do?     A.  That  is  so. 

Q.  "Discrimination,  preference, or  favor  to  one  over  another,"  that 
we  have  already  treated  ;  the  whole  business?     A.  Yes,  sir. 

Q.  "In  price."  You  are  not  charging  one  man  more  than  another 
in  price  for  the  same  services?     A.  That  is  correct. 

Q.  That  is  the  way  that  men  ought  to  be  served.  Will  that  embar- 
rass your  railroad  ?     A.  Not  at  all. 

Q.  The  next  is,  "  dispatch  and  speed."  That  is  to  say,  that  you  will 
not  give  one  man  a  superior  right  over  another  in  the  matter  of 
time.     That  won't  hurt  the  railroad?     A.  No,  sir. 

Q.  "  Or  accommodation  of  any  kind."  That  means,  as  I  under- 
stand it,  that  all  shall  be  treated  alike  or  about  alike?  A.  The 
whole  thing  being  assumed  that  no  accident  is  going  to  occur  on  the 
road 

Q.  By  washouts,  or  snow,  or  anything  of  that  kind.  That  does  not 
cut  any  figure  here?     A.  No. 

Q.  Of  course  everybody  served  on  that  trip  would  have  to  stand 
the  washouts,  "  except  as  hereinafter  provided."  "All  freight  shall 
be  dispatched  and  forwarded  in  the  order  in  which  it  is  received  or 
tendered  for  transportation."  There  is  no  harm  there  in  a  general 
way  ?     A.  None  at  all. 

Q.  "Except  that  a  preference  may  be  given  to  perishable  articles." 
That  rule  is  already  observed  by  railroad  companies?     A.  Yes,  sir. 

Q.  And  they  will  not  have  any  greater  burden  imposed  upon  them 
if  this  bill  passes  than  they  have  now,  in  that  respect?    A.  The  same. 

Q.  "And  to  express  matter  and  fast  freights."  If  anybody  has  any 
matter  that  he  is  in  a  hurry  to  send,  of  some  character,  and  he  don't 
want  it  to  go  by  slow  freight,  all  he  has  to  do  is  to  pay  the  fast 
freight?    A.  That  is  it. 

Q.  All  persons  who  want  to  send  goods  by  the  fast  freight  can  have 
the  same  accommodations  upon  the  same  terms?     A.  Yes,  sir. 

Q.  That  is  upon  an  existing  railroad  principle?    A.  Yes,  sir. 

Q.  That  would  not  embarrass  the  railroad  company  in  any  way? 
A.  No,  sir. 

Q.  "And  equal  and  similar  facilities,  not  inferior  to  any  in  use 
January  1,  18S4,  shall  be  extended  on  like  terms  to  all  connecting 
transportation  lines,  whether  by  land  or  water."  That  can't  hurt 
you.  Railroad  people  do  not  expect  to  retrograde.  That  is  not 
likely,  is  it?     A.  No,  sir. 

Q.  Now,  you  have  stated  your  only  objection  to  section  one,  and 
that  was  as  to  printing  the  schedule;  and  I  see  no  difficulty  there,  if 
the  law  was  amended  (looking  at  it  in  a  business  manner)  so  that  if 


30 

you  are  required  to  print  a  schedule,  you  would  have  a  reasonable 
time  to  do  it  in ;  and  there  being  no  prohibition  there  to  forwarding 
freight,  and  no  prohibition  to  writing  in  the  schedule,  you  can  do  it 
if  the  law  does  not  prohibit  it?     A.  Yes,  sir. 

Q.  If  a  man  comes  with  a  new  class  of  freight,  there  is  nothing  in 
this  bill  to  prevent  you  from  writing  in  there  whatever  you  want  to. 
This  bill  needs  no  amendments  as  far  as  that  is  concerned?  A. 
That  is  not  inserted,  that  you  may  be  allowed  to  write  in.  When 
that  is  in  that  will  do.     That  is  not  in. 

Q.  It  is  not  prohibited  ?    A.  No,  sir. 

Q.  We  are  now  reading  a  penal  statute  (as  this  is  in  a  measure), 
and  what  is  not  prohibited  by  penal  statute,  you  may  do.  That  is 
law?    A.  I  presume  that  is  law. 

Q.  If  you  can  do  it  now,  you  can  do  it  if  this  bill  does'not  prohibit 
it.  Do  you  not  so  understand  it?  A.  I  suppose  if  you  say  that  is 
legal,  it  must  be  so. 

Q.  Well,  not  necessarily;  but  I  thank  you  for  the  compliment.  I 
feel  very  proud  of  it,  but  at  the  same  time  I  submit  it  to  your  good 
judgment  and  sense,  as  a  business  man,  wouldn't  you  so  understand 
a  penal  statute  which  says  you  shall  not  do  this,  and  if  you  do  you 
shall  be  punished,  and  if  in  looking  over  that  statute  you  found  that 
that  which  is  not  prohibited  you  may  do,  would  you  so  understand 
it  if  this  were  in  the  nature  of  a  penal  statute?  A.  If  the  law 
required  that  it  should  be  printed,  and  I  should  write  it  in,  I  might 
be  doing  something  contrary  to  the  law. 

Senator  Reddy — Well,  I  will  call  your  attention,  Mr.  Chairman, 
to  the  fact  that  the  word  "printing"  includes  writing,  and  that  the 
word  "writing"  includes  printing. 

The  Chairman — If  I  am  to  answer  the  question  I  would  say  that 
that  is  true  as  to  the  construction  of  contracts,  but  not  as  to  the  con- 
struction of  statutes  (reading  Code).  Writing  includes  printing,  but 
it  does  not  say  that  printing  includes  writing. 

Q.  There  is  no  prohibition  here  in  regard  to  forwarding  freights. 
Now,  what,  to  your  mind,  would  be  the  result,  say,  if  a  person 
brought  a  band  of  peculiar  animals — we  will  say  camels — for  which 
you  have  no  classification.  Would  you  allow  the  man  to  hold  the 
camels  at  the  railroad  station,  perhaps  in  want  of  food  and  at  great 
expense,  and  you  had  no  other  freight  to  ship,  until  you  would  go  to 
Carson  and  visit  the  printing  shops  and  have  it  done?  Would  you 
say:  "Gentlemen,  you  will  have  to  wait  till  I  can  send  to  Carson 
and  get  my  schedule  altered  before  I  can  send  your  camels?"     A.  No. 

Q.  Why  not?     A.  Because  you  would  have  absolute  action. 

Q,.  Would  you  credit  lawyers  (I  won't  say  lawyers,  because  they 
might  be  credited  with  anything),  but  do  you  think  that  the  Courts 
in  this  country  would  consider  that  you  had  injured  anybody  by 
acting  in  that  absolute  way  without  injuring  anybody?    A.  No,  sir. 

Q.  Then,  as  a  business  man,  you  would  forward  the  camels  and 
get  your  schedule  printed  as  soon  as  you  could?  A.  It  is  the  same 
proposition  that  I  gave  you  with  reference  to  the  poor  man  with  his 
household  goods.  There  are  lots  of  things  that  would  come  into  this 
bill  that  the  Courts  would  never  worry  me  about. 


31 

Q.  If  you  forwarded  my  furniture — being  a  poor  man — the  same 
as  you  forwarded  any  other  poor  man's,  3rou  would  not  be  discrimi- 
nating, would  you?     A.  No,  sir. 

Q,  That  law  does  not  say  that  you  shall  discriminate  to  that 
extent,  but  that  you  shall  treat  everybody  alike  ?     A.  Yes,  sir. 

Q.  You  have  had  a  large  railroad  experience?  A.  Quite  large; 
quite  considerable. 

Q.  When  you  lay  out  a  railroad,  you  are  required  to  file  a  map  in 
some  public  office  in  the  State?    A.  Yes,  sir. 

Q.  On  that  map  what  do  you  show?     A.  The  line  of  the  railroad. 

Q.  And  you  get  a  franchise  then,  and  the  power  of  the  State  is  used 
to  give  you  a  right  of  way  over  that  line?     A.  Yes,  sir. 

Q.  And  then  towns  are  built  up  along  the  line  of  that  road? 
A.  Yes,  sir. 

Q.  And  the  railroad  generally  goes  by  the  town  ;  in  fact,  the  people 
generally  invite  them  to  build  there  ?     A.  Very  frequently. 

Q.  Do  you  know  of  an  instance  where  a  town  site  has  been  started, 
and  a  Court  House  built,  and  a  whole  community  settled  along  the 
line  of  a  road  which  has  grown  to  be  a  thriving  community? 
A.  Yes,  sir. 

Q.  The  purpose  for  which  a  railroad  is  formed  is  stated  in  the 
articles  of  incorporation,  is  it  not?     A.  Yes,  sir. 

Q.  Now,  do  you  claim  that  you  have  a  right  to  change  that,  and  to 
discriminate  against  one  of  those  communities  that  has  been  built 
up  on  the  strength  of  that?     A.  No,  sir. 

Q.  Then  if  your  depot  should  be  burned  down  at  the  town  of 
Hawthorne,  wrould  you  claim  that  you  would  have  a  right  to  rebuild 
it  five  miles  away  from  the  town  and  leave  it  out  entirely?  A.  No, 
sir. 

Q.  If  that  power  were  given  to  the  corporation  which  has  laid  out 
the  line  of  its  road,  and  given  notice  to  the  world  as  to  where  it 
should  run,  and  has  invoked  the  power  of  the  State  to  enable  it  to 
establish  its  route  upon  that  line  of  route,  and  the  people  having 
built  up  a  town,  or  started  a  town,  and  made  a  general  depot  for  sup- 
plies and  shipping,  do  you  claim  that  it  would  be  right  for  a  railroad 
company  to  alter  the  accommodations  and  to  remove  its  track  and 
buildings  from  that  town?     A.  It  would  be  a  very  great  hardship. 

Q.  Would  it  hurt  any  railroad  to  deny  them  that  right,  in  your 
judgment  ?  Can  there  be  any  objection  to  doing  it,  looking  at  it  in 
the  light  of  the  railroad  interests?  A.  I  will  tell  you  something  that 
occurred  a  short  time  since.  The  Government  of  the  United  States 
gave  us  land  enough  to  put  up  buildings.  A  party  came  in  and  put 
up  a  house  for  a  hotel,  and  we  never  for  a  moment  supposed  that  he 
was  trying  to  get  control.  He  had  asked  us  if  he  could  build  a  house 
on  it,  but  the  first  thing  we  knew  he  came  in  and  says,  "I  have  got  a 
title  from  the  United  States,  and  I  own  all  these  buildings,"  and  he- 
was  going  to  sell  town  lots,  and  so  on.  We  thought  it  was  rather 
rough,  and  we  proposed  to  remove  our  station  about  five  miles  from 
there,  and  let  him  keep  his  buildings.  Now,  there  was  a  case  in 
which,  if  I  had  the  power  to  do  things,  I  should  have  probably 
done  it. 


32 

Q.  Supposing  that  you  had  any  station  established  on,  the  line  of 
the  road,  and  it  turned  out  that  the  title  thereto  was  in  the  State, 
and  the  laws  of  the  State  had  been  used  to  remove  you  from  it,  do 
you  think  you  would  forfeit  your  charter  if  the  State  itself  removed 
you  from  that  station? 

Senator We  submit  that  that  is  a  legal  proposition. 

The  Chairman — This  raises  the  question  whether,  if  any  Senator 
objects  to  a  question,  upon  any  ground,  the  Chair  shall  rule  upon 
the  objection.  My  idea  would  be  that  such  a  course  would  be  proper, 
but  I  would  like  to  have  the  sense  of  the  committee  upon  it. 

|  Ordered  that  such  course  be  pursued.] 

Q.  I  understood  you  that  it  would  not  interfere  with  their  rights 
to  compel  the  railroad  company  to  keep  up  all  their  bridges  and  so 
on,  and  keep  them  in  repair  "  for  the  purposes  for  which  they  were 
constructed."  If  they  desire  to  do  that,  then  they  are  not  injured  it 
the  right  is  taken  from,  are  they?     A.  No,  sir. 

Q.  (reading  bill).  "If  it  is  restored  to  as  good  a  condition  as  it  was 
before,  and  serves  the  purposes  for  which  it  was  intended,"  that  is 
all  that  the  bill  demands,  is  it  not?  A.  That  is  the  way  that  it  is 
here,  although  the  question  might  be  as  to  whether  it  was  to  be 
restored  to  the  exact  spot  where  it  was  before,  from  which  it  was 
originally  taken. 

Adjourned  till  two  o'clock. 


Senator  Vrooman  —  I  understood  you  this  morning,  in  your  tes- 
timony, to  state  that  you  were  addressing  yourself  principally  to  the 
moving  of  freight  and  carrying  loads,  and  with  reference  to  the  effect 
of  this  bill  upon  the  transportation.  Was  that  it?  A.  That  was  the 
understanding;  yes,  sir. 

Q.  Have  you  anything  to  say  in  regard  to  moving  freight  in  quan- 
tities less  than  a  carload,  and  as  to  the  effect  that  this  bill  would  have 
upon  it?  A.  In  answering  that  question,  I  did  not  speak  at  that  time 
of  freight  on  things  of  that  kind.  In  doing  business,  as  a  rule,  we 
usually  receive  carloads  of  ore  on  our  road  at  a  particular  station, 
although  at  some  stations  we  have  parts  of  carloads.  We  have,  as 
our  main  business,  straight  carloads  of  lumber  and  wood,  and  ores 
and  machinery,  and  that  is  what  I  had  reference  to. 

Q.  What  would  be  the  effect  of  the  bill  if  you  were  to  ship  in  less 
quantities?  A.  It  would  bother  us  considerably  if  we  had  to  ship  in 
quantities  less  than  straight  carloads. 

Q.  In  what  way?  A.  It  might  be  that  a  half  a  dozen  people  would 
come  with  a  carload,  having  a  ton  or  a  ton  and  a  half  apiece,  and  if 
we  were  obliged  to  make  up  a  car  and  only  take  one  ton  we  would  be 
obliged  to  charge  such  a  rate  that  a  man  could  not  afford  to  pay  it, 
or  else  let  it  stay  till  we  got  a  carload.  And  that  is  what  we  do.  We 
ship  it  as  quick  as  we  possibly  can.  They  cannot  expect  us  to  ship  a 
part  of  a  carload.  Ji'  a  man  wishes  us  to  ship  a  part  of  a  carload  we 
are  obliged  to  charge  for  a  full  rate. 

Q.  Suppose  that  a  quantity  of  wood  is  presented  to  you,  such  as 


33 

will  load  all  of  your  cars  but  one,  and  would  furnish  half  a  load  as 
to  that;  and  that  a  quantity  of  coal  is  presented  at  the  same  time. 
Do  you  ever  put  wood  and  coal  in  the  same  car?  A.  No  sir  ;  unless 
it  is  in  sacks. 

Q.  If  it  was  coal  in  hulk?    A.  Not  in  bulk. 

Q,.  Under  this  bill,  these  being  presented  at  the  same  time,  and 
being  of  the  same  class  of  freight  as  to  being  non-perishable,  what 
would  you  do,  there  being  something  here  to  prevent  you  from  ship- 
ping freight  except  in  the  order  received  ?  A.  If  I  could  not  arrange 
to  put  them  both  in  the  same  car  I  would  necessarily  be  compelled 
to  hold  them  until  I  could  get. another,  if  I  correctly  understand  it, 
or  charge  enough  to  send  a  half  a  car.  That  would  be  the  only  thing 
left  open. 

Q.  You  have  no  objection  to  section  one  of  the  bill  as  it  now 
stands,  so  I  understood  you  to  state  this  morning?  A.  J^,  I  did  not 
intend  that. 

Q.  What  do  you  intend  to  be  underatood  as  saying  upon  that 
point?  A.  I  wanted  to  answer  that  the  freight  when  offered  should 
be  "of  the  same  class  or  kind." 

Q.  How  would  you  have  the  bill  read?  A.  "All  offered  of  the 
same  class  or  kind." 

Senator  MoClure — You  would  put  after  the  word  "  another,"  "of 
the  same  kind  or  class  "  (reading  it  in  that  way). 

Senator  Vrooman — Generally,  you  would  have  that  limited  so 
discrimination  would  apply  to  persons,  but  would  not  apply  to 
classes  of  freight.  Have  you  anything  to  say  in  regard  to  line  eleven, 
on  page  two?  A.  The  same  thing  would  apply  all  the  way  through, 
"of  the  same  class  or  kind,"  because  the  same  objection  to  that  first 
section  would  prevail  all  the  way  through. 

Q.  Then  it  would  be  so  drawn  as  to  prevent  personal  discrimina- 
tion and  partiality?  A.  That  would  be  the  one  that  I  would  prefer. 
I  exemplified  that  about  the  carload  of  silk  and  the  potatoes  ia 
talking  about  this  matter  this  morning.  That  was  my  view  then, 
and  it  is  now,  although  I  don't  know  that  I  made  myself  understood. 

Q.  Have  you  anything  further  to  say  about  section  two,  as  to  having 
a  schedule  printed  as  to  how  far  that  should  go.  Have  you  any 
suggestion  to  make,  as  a  practical  railroad  man,  with  relation  to  the 
amendment  of  that  section  ?  A.  In  speaking  about  that  matter,  I 
suggested  that  there  should  be  an  opportunity  left  open  for  the  agent 
to  nil  in  in  writing  any  changes  to  be  made,  so  as  to  avoid  the  making 
of  a  new  schedule  every  time  a  change  was  made,  which  might  be 
every  day,  but,  of  course,  my  understanding  was  without  very  careful 
reading  of  the  bill,  that  it  applied  only  to  stations  within  this  State; 
for  instance,  we  would  not  like  to  say  as  a  matter  of  fact  that  we 
would  deliver,  or  undertake  to  deliver,  goods  on  our  line  beyond  the 
junction  of  our  stations  or  east  of  the  particular  point — at  the  end 
of  it  possibly. 

Q.  Will  you  give  me  the  name  of  any  particular  station  on  your 
line?     A.  Virginia  City. 

Q.  Supposing  that  this  bill  was  in  force  in  California,  and  your 
office  in  Virginia,  desired  to  ship  freight  to  California,  under  this  bill 

3 


34 

as  it  now  reads  you  would  have  to  furnish  a  schedule  from  Virginia 
to  every  point  on  the  whole  route — an  entire  schedule  ?  A.  No,  sir; 
I  did  not  so  understand  it;  I  think  it  would  be  only  necessary  to 
show  what  the  schedule  was  on  that  particular  line  of  the  road  where 
he  wished  to  ship. 

Q.  Line  four,  on  page  two,  reads  "  between  all  points  ;  "  now,  would 
not  this  bill  be  better  by  inserting,  after  the  word  "  transporta- 
tion," "  from  that  particular  station  to  all  points  and  stations  to  or 
from  which  they  carry  over  their  routes  in  this  State?  "  A.  That,  it 
seems  to  me,  would  be  the  fair  thing;  I  don't  see  why  they  should 
ask  for  a  schedule  to  go  over  all  the  routes  outside  of  the  State, 
because  outside  of  the  State  we  are  getting  into  different  lines ;  we 
have  different  rates  and  different  tariffs;  the  law  itself  gives  us  a 
difference;  we  have  a  different  one  in  Nevada  from  what  we  have  in 
this  State,  and  all  the  agent  wants  to  know  is  what  the  freight  is  to 
this  station — where  the  goods  are  to  be  shipped  to — is;  he  has  got  to 
know  that  so  as  to  know  what  to  charge. 

Q.  Then  if  it  were  to  read,  "  Transportation  from  that  particular 
station  to  all  points  and  stations  to  or  from  which  they  carry  in  this 
State,"  it  would  cover  every  possible  case  of  accommodating  the 
patron  of  the  road?     A.  It  seems  to  me  so. 

Q.  Have  you  anything  to  say  concerning  section  three,  further 
than  you  said  this  morning?  A.  As  I  said  this  morning,  in  reading 
it  over  first  I  had  the  impression  that  it  related  to  bridges,  etc.  But 
in  the  discussion  afterwards  between  Mr.  Reddy  and  another  gentle- 
man, the  question  of  stations  was  brought  in,  and  then  the  next 
thing  that  came  up  was  about  the  proposition  of  the  railroad  taking 
away  the  stations,  and  removing  them  off  some  four  or  five  mileS 
into  some  other  town.  I  took  occasion  at  the  time  to  say  that  it 
was  wrong  to  do  that.  If  that  w7as  the  intention  and  design  to 
destroy  the  town  or  community,  it  was  bad  business  and  ought  not 
to  be  done,  I  don't  care  who  did  it.  But  if  that  is  the  object  of  this 
bill,  to  prevent  that  sort  of  thing,  let  it  be  inserted.  If  that  is  not 
the  purpose,  then  it  might  operate  to  prevent  the  company  from 
doing  the  things  that  it  would  be  necessary  for  them  to  do.  For 
instance,  we  have  a  station  at  a  mining  camp,  and  it  goes  all  to 
pieces.  We  have  one  case  like  that  to-day.  In  fact,  we  have  taken 
away  a  station  and  closed  the  office,  and  taken  away  our  telegraph 
operator.  Now  if  we  wanted  to  take  that  building  clown,  anil  go 
and  put  it  somewhere  else,  I  understand  that  under  this  law  you 
couldn't  do  it;  but  the  presumption  is  that  if  we  have  built  a  branch 
from  there  to  any  of  the  mining  camps,  and  we  didn't  keep  that  up, 
it  would  follow  that,  under  the  provisions  of  this  bill,  we  would  lose 
our  charter,  and  I  understand  that  is  the  intention  of  the  bill. 

Q,  I  suggest  that  the  bill  is  very  plain  and  expresses  certain  ideas. 
Whether  it  expresses  the  ideas  intended  I  don't  know.  We  are  to 
presume  that  it  means  what  it  says  upon  its  face  ;  we  pursue  it  upon 
that  basis.  I  ask  you  if  section  three,  assuming  that  it  means  what 
it  says,  would  be  in  the  interests  of  the  people  of  the  State  who  are 
engaged  in  railroad  building?  A.  Certainly  it  would  not,  in  that 
view. 


35 

Q.  Speaking  as  a  railroad  man,  after  you  had  a  charter  to  build  a 
road  (having  in  mind  section  three),  say  between  Sacramento  and 
Stockton,  with  branch  lines,  and  say  that  you  had  constructed  a 
branch  line  to  some  mining  camp,  and  after  operating  it  a  year 
and  found  that  it  did  not  pay  running  expenses  and  was  an  accom- 
modation and  a  benefit  to  no  one,  state  whether  or  not  you  think 
you  would  have  a  right  to  take  up  that  branch  line  and  discontinue 
it  without  forfeiting  your  charter?     A.  I  should  hope  so. 

Q.  Looking  at  this  bill?  A.  Looking  at  this  bill  I  don't  know  as 
I  could. 

Q.  I  will  ask  you  now  if  you  consider  this  bill,  as  a  whole,  in  the 
interests  of  the  productive — or  would  it  be  beneficial,  if  it  became  a 
law,  to  the  productive  and  manufacturing  interests  of  this  State  in 
the  matter  of  transportation?  A.  It  would  place  things  in  such  a 
shape,  so  far  as  our  company  is  concerned,  that  we  could  not  carry 
out  the  projects  which  we  have  in  view,  and  it  would  be  injurious  to 
a  great  deal  of  the  business  of  the  State. 

Q.  Injurious  because  of- the  restrictions  that  it  would  place  upon 
transportation?  A.  Not  that  only,  but  there  is  another  thing  I 
would  like  to  say.  I  would  like  to  ask  you  this  question,  after  look- 
ing over  section  three :  Suppose  that  a  railroad  was  built  under  the 
laws  of  this  State,  and  was  found  not  to  pay  at  all,  and  that  it  was 
running,  say  four  trains  a  day,  and  came  to  the  conclusion  to  run 
but  one  train  a  day,  could  a  person  insist  that  those  trains  should  be 
put  back  again,  and  that  it  should  be  done  immediately;  or  if  the 
train  had  to  be  made  up,  and  there  was  not  sufficient  for  a  train,  and 
nothing  to  take  as  freight,  and  he  then  withdrew  it,  would  he  be  sub- 
ject to  prosecution  under  this  law? 

Q.  That  is  the  way  that  I  read  the  bill.  It  is  perfectly  plain  in 
regard  to  those  provisions.  A.  If  that  were  the  case,  supposing  that 
we  concluded  to  shut  our  road  down  for  six  months. 

Q.  You  would  forfeit  your  charter.  A.  They  might  say  that  the 
business  might  come  here  again. 

Q.  "  Equal  and  similar  facilities,  not  inferior  to  any  in  use  January 
1,  1884,"  etc.;  that  is,  if  they  were  running  ten  trains  a  day  on  the 
first  of  January,  1884,  they  woukl  always  have  to  run  that  many,  or 
at  least  that  many  trains,  or  forfeit  their  charter.  A.  Where  is 
that?  I  want  to  say  that  I  never  saw  this  bill  till  I  came  before  this 
committee.  I  looked  at  a  bill  which  I  understood  to  be  brought  up, 
but  which  was  not  the  case.  Of  course  I  have  answered  all  the  ques- 
tions which  gentlemen  asked  me  as  well  as  I  could. 

Senator  Cross — You  had  the  impression  that  the  Barry  bill  was 
the  one  which  fixed  the  freights  and  fares?  A.  Yes,  sir.  I  was 
interested  in  the  rates  of  freights  and  fares  on  roads,  and  I  wanted  to 
give  the  committee  my  views  in  regard  to  freights  and  fares. 

Sknator  Vrooman — Of  course  you  are  interested  in  the  railroad 
enterprises?     A.  Yes,  sir. 

<t>.  If  this  bill  were  to  become  a  law  and  go  into  force  in  this  State', 
would  you  as  a  railroad  man,  or  as  a  moneyed  man,  feel  justified  in 
investing  your  means  in  the  construction  of  new  railroads?  A.  No, 
sir. 


36 

Senator  Sullivan — In  reference  to  that  point  in  section  one,  that 
the  carrying  should  be  of  the  "same  class  or  kind,"  isn't  that  the 
point  into  which  discrimination  enters?  For  instance,  here  is  a  ton 
of  ore  which  contains  base  metal,  and  here  is  another  ton  which  is 
of  a  finer  quality.  Now,  on  one  you  might  charge  $10  a  ton,  and  on 
the  other  you  might  charge  $30  a  ton.  One  would  be  class  A,  and 
the  other  would  be  class  B.  Now  I  take  it,  and  I  think  you  will  bear 
me  out,  one  does  not  take  any  more  trouble  pr  require  any  better 
service  than  the  other,  and  the  cost  of  carrying  each  ton  is  the  same  ; 
the  only  difference  is  that  one  brings  to  the  miner  more  than 
the  other.  Now,  I  take  it  that  if  these  words  were  put  in,  "of  the" 
same  class  or  kind,"  the  provisions  of  the  law  with  regard  to  dis- 
crimination would  be  defeated  in  regard  to  discrimination  by 
considering  the  value  of  the  ore?  A.  You  are  a  miner  and  open- 
ing up  your  mine,  and  you  have  two  or  three  classes  of  ore.  You 
come  to  the  railroad  company  and  say,  "What  are  your  rates  for 
transporting  ore  per  ton  to  San  Francisco?"  He  says,  "Twenty 
dollars  a  ton  to  San  Francisco."  You  say," "  What  will  you  haul  my 
ore  for?"  I  will  say,  "  How  much  have  you  got?  How  long  will 
you  be  able  to  ship  with  us?  What  is  the  ore  worth?"  You  tell  me 
that  you  have  ore  which  is  worth  $500  a  ton,  but  the  great  majority 
of  it  is  low  grade  and  not  worth  more  than  $30  a  ton,  and  that,  you 
want  to  ship  it  all.  I  will  say  to  you,  "In  order  to  enable  you  to  do 
that,  if  you  will  give  me  all  of  this  ore,  I  will  take  the  low  grade  at 
almost  cost,  or  probably  at  cost  (we  have  done  that  several  times), 
but  I  want  you  to  give  me  a  fair  living  rate  on  the  ore  which  pays 
$500  a  ton."  That  is  the  proposition  that  I  make  to  you.  Then  you 
say,  "What  will  your  rates  be?"  and  I  will  tell  you.  Probably  the 
rate  on  the  best  ore  would  be  ten  dollars  a  ton  more  than  on  the 
other.  My  object  in  doing  that  would  be  this:  In  running  your  mine 
you  would  have  supplies  to  take  back  and  men  at  work,  for  which  I 
would  get  freights  and  fares,  and  back  freights,  and  if  I  aid  you  in 
getting  your  mine  running,  and  in  getting  out  several  thousand  tons 
of  ore,  I  do  something  in  getting  it  in,  and  in  getting  in  supplies. 
That  is  the  answer  to  that  point. 

Q,  I  have  read  that  answer  some#here  in  the  report  of  the  Rail- 
road Commissioners,  and  it  does  not  seem  to  my  mind  a  reason  why 
you  should  charge  such  a  great  difference  as  I  notice  is  charged. 
Now,  there  are  three  or  four  different  classes.  Instead  of  ore,  we  will 
take  silk.  There  are  three  or  four  grades  of  silk.  One  grade  is 
marked  $1  a  yard,  another  $5,  and  another  $10.  Now,  if  a  railroad 
company  is  allowed  to  classify  its  freight  "  of  the  same  kind  "  or 
character,  it  would  make  classes  A,  B,  C,  D.  It  would  enter  into  the 
profits  of  the  person  who  is  the  consignee.  In  other  words,  it  would 
be  charging  according  to  the  amount  which  the  silk  would  bring  in 
San  Francisco.  Do  you  understand  that  to  be  the  meaning  or  the 
object  of  using  the  words  "  of  the  same  class  or  kind  ?  "  A.  I  under- 
stand.    Do  you  want  to  know  the  reason  why  that  is  done? 

Q.  I  understand  that  is  done,  and  that  is  one  reason  why  the  Barry 
bill  is  brought  forward.  A.  Supposing  a  carload  of  silk  was  worth 
$10,000  and  another  carload  was  worth  $5,000.     There  is  such  a  thing 


37 

as  a  smashup  and  a  carload  of  silk  being  destroyed,  and  the  railroad 
company  would  have  to  pay  for  it.  And  they  are  frequently 
destroyed  by  fire.  A  car  may  get  off  the  track,  and  we  might  lose 
the  profits  of  a  year,  and  of  course  they  want  something  to  offset 
that. 

Q.  That  is  your  idea  of  the  reason  for  the  difference  in  charges? 
A.  There  are  various  other  things  that  enter  into  it.  I  am  not  so 
well  posted  in  the  silk  business  as  I  am  in  other  business. 

Q.  Take  for  instance  the  question  of  chairs  used  for  offices  such  as 
our  Chairman  has.  Now,  one  man  is  charged  two  dollars  and  fifty 
cents  in  the  market  for  an  ordinary  oak  chair,  and  a  walnut  chair  is 
worth  two  dollars  and  seventy-cents  or  three  dollars.  Now,  we  must 
assume  that  it  is  not  on  account  of  services,  or  of  room  that  the  chairs 
occupy  in  the  car,  for  those  are  the  same;  but  I  understand  that 
there  is  a  great  difference  in  regard  to  the  freight  that  is  charged 
upon  them.     A.  I  don't  know  that  there  is. 

Q.  Don't  you  think  that  this  change  in  the  Barry  bill  from  offering 
freight  to  be  transported,  to  offering  freight  of  the  same  class  or  kind, 
carries  it  right  back  to  the  present  basis;  that  it  gives  the  common 
carrier  the  rights  which  he  has  at  present?  Would  it  make  any 
change  in  results  between  the  common  carrier  and  the  consignor 
and  consignee  of  goods?  Wouldn't  it  leave  the  railroad  companies 
in  the  same  position  that  they  are  in  to-day?  A.  I  dare  say  that  it 
would  imsome  respects. 

Q.  Would  it  not  in  all  respects?  A.  No;  because  here  it  says  that 
they  are  to  take  the  various  freights  as  they  come  in  their  order.  There 
is  no  law  of  that  kind  now.  It  imports  that  it  does.  That  is  what 
I  understand  is  the  object  of  this  bill.  I  don't  understand  that  the 
object  of  this  bill  is  to  cut  down  freights. 

Q.  No,  sir;  it  does  not.  A.  That  is  what  it  amounts  to.  There  is 
an  awful  range.  Take  ores  that  run  from  $30  up  to  $500  a  ton,  and 
that  is  just  what  we  are  doing.  If  we  lost  one  of  those  carloads,  we 
should  have  to  pay  for  it.  We  had  a  smashup  the  other  day  of 
nineteen  carloads  of  ore,  dumped  right  into  a  ditch,  and  the  com- 
pany had  to  pay  for  it. 

Q.  Would  you  take  that,  then,  to  be  the  reason  for  the  difference 
in  charges,  the  difference  in  the  kinds  of  ore,  and  the  different  kinds 
of  freight  and  merchandise?  A.  You  asked  me  the  simple  question 
in  regard  to  ore  because  I  am  more  familiar  with  that.  We  have 
got  mines  running  which  pay  men  $4  a  day,  and  merchants  selling 
their  goods  to  them,  and  farmers  selling  their  produce  and  horses 
and  cattle  for  use  in  working  these  mines.  We  are  helping  the 
whole  country.  They  would  never  do  anything  in  Owen's  Lake 
Valley  unless  we  shipped  these  ores,  and  we  could  never  ship  these 
low  grade  ores  unless  we  charged  a  good  round  price  on  ores  of  high 
grade,  that  will  bear  it,  to  enable  us  to  carry  ores  that  will  not  bear 
it.     If  we  can't  open  these  lines,  we  can't  run  our  roads. 

Q.  Take  the  higher  grade  of  ore — any  quality  which  will  pay  not 
only  the  miner,  but  also  the  transporter  or  common  carrier — and  I 
believe  it  is  a  fact  and  you  will  acknowledge  that  there  is  a  differ- 
ence, a  great  difference,  beyond  what  you  charge  as  freight  in  regard 


38 

to  the  grades  of  ore — you  classify  them  as  A,  B,  and  C?  A.  We  have 
a  classification  that  covers  almost  everything.  For  instance,  we  will 
take  ore  that  is  worth  $200  a  ton  and  bring  it  over  our  road  and  make 
arrangements  with  the  Central  Pacific  Railroad  to  deliver  it  in  San 
Francisco  at  $11  a  ton.  Now  the  miner  can  take  his  carload  of  ore 
here  and  make  an  average  on  his  low  grade  ore.    ' 

Q.  Do  I  understand  you  to  say  that  there  is  ore  in  Inyo  and  Mono 
Counties  of  such  a  character  that  the  consignor  cannot  make  any- 
thing in  mining  it?     A.  Certainly;  lots  of  it. 

Q.  How  does  the  common  carrier  make  anything  out  of  it? 
A.  There  is  some,  fortunately,  that  is  higher  grade,  and,  as  I  told 
you,  the  miner  manages  so  that  by  taking  the  rich  and  the  poor 
together  that  he  can  get  such  a  rate  that  he  can  make  fair  pay,  and 
we  are  satisfied  to  bring  it  down  here  and  we  all  make  a  good  living 
at  satisfactory  rates. 

Q.  Did  I  understand  you  to-day  that,  taking  this  bill  as  a  whole,  if 
you  were  out  of  the  railroad  business  you  would  not  go  into  it  again? 
A.  I  most  decidedly  say  so. 

Q.  What  is  the  principal  point  of  your  objection?  A.  It  would  be 
one  very  good  reason  that  you  would  not  allow  me  to  classify  my 
freight  under  that  bill,  and  you  would  not  allow  me  to  discriminate 
as  to  persons  or  as  to  places.  If  I  could  discriminate  I  could  help 
persons  every#day,  but  unless  I  can  do  it  it  don't  make  any  difference 
and  it  is  no  use  talking  about  it. 

Q.  As  I  understand  this  bill,  it  is  one  that  inflicts  a  penalty,  and 
therefore  must  be  liberally  construed  under  the  statute.  Now,  this 
penalty  :  I  understood  you  to  say  that  if  this  bill  was  in  force,  and 
these  people  did  these  things,  they  could  bankrupt  any  road  ?  A. 
Yes,  sir.  There  might  be  an  agent  of  the  company  tliat  would  go  to 
work  and  break  nearly  every  one  of  these  laws,  because  he  did  not 
like  the  company,  and  then  should  the  railroad  company  go  by  the 
board  ?  The  company  should  not  suffer  because  of  his  act.  But  the 
bill  says  that  the  company  shall  lose  its  charter  and' the  man  go  to 
jail.  Now  I  think  that  the  man  should  go  to  jail,  but  the  company 
should  not  lose  its  charter.  If  I  understand  this  rightly,  it  says 
that  the  act  of  the  agent  forfeits  the  charter  (reading  section  seven). 

Senator  Baldwtin — That  refers  to  sections  one,  two,  and  three. 

Senator  Sullivan — You  say  that  ores  are  classified,  and  that  one 
grade  is  $50,  and  another  grade  $30  ore,  and  some  very  much  higher, 
and  that  there  are,  of  course,  grades  of  intermediate  value  ?  A. 
Yes,  sir. 

Q.  Now,  this  classification  is  not  based  upon  any  particular  diffi- 
culty in  carrying  these  ores,  because,  I  presume,  it  is  just  as  easy  to 
carry  thousand  dollar  ore  as  it  is  ore  that  is  worth  thirty  dollars.  It 
must  then  be  based  upon  the  principle  of  insurance,  and  not  upon 
the  facility  of  carrying  it?  A.  No,  sir  ;  that  cuts  but  a  small  figure; 
not  a  very  large  one.  That  is  why  I  said  that,  if  a  carload  should  be 
lost,  or  ruined  in  going  over  the  road,  that  the  company  would  have 
to  pay  for  it. 

Q.  If  it  is  not  insurance,  why  make  this  classification,  if  it  is  just 
as  easy  to  carry  high  as  low  grade  ore?     A.  I  explained  that  there 


39 

were  a  great  number  of  mines  in  the  country  over  which  this  road 
of  ours  runs,  and  in  fact  the  majority  of  the  mines  is  low  grade  ore. 
The  people  who  own  those  mines  know  that  the  price  they  can 
afford  to  pay  us  is  a  price  that  we  cannot  afford  to  take,  provided 
it  was  the  only  business  we  had.  A  man  of  that  kind  comes  to  us 
and  we  say,  "We  will  put  this  rate  down  low,  at  almost  cost,"  and 
in  some  cases  we  do  it  at  cost.  If  in  the  future  he  gets  ore  that  is 
worth  $500  a  ton,  we  want  an  advanced  freight.  We  want  to  get 
even,  as  near  as  we  can,  on  the  carrying  of  this  low  grade  ore.  The 
road  is  entitled  to  have  that  for  carrying  this  freight,  no  matter  what 
it  is,  and  therefore  the  rate  is  higher.  A  man  comes  to  us  to  carry 
low  grade  ore.  He  is  able  to  get  his  supplies,  to  work  his  mine  and 
keep  his  men  at  work  and  get  grub  for  them,  and  the  farmer  sells 
him  grain,  and  it  makes  a  general  business  through  the  country. 
That  is  the  reason  why  we  want  to  grade  these  ores. 

Q.  That  is  all  right.  But  you  have  a  mine  that  has  high  and  low 
and  intermediate  grades  of  ore.  I  don't  suppose  that  a  mine  has  all 
low  grade  ore,  or  that  a  neighboring  mine  is  all  high  grade  ;  but  if  I 
understand  you,  what  the  low  grade  ore  will  not  stand  you  put  on 
the  high  grade?  A.  Well,  it  would  come  to  that  to  some  extent. 
But  if  we  carried  the  high  grade  ore  only,  there  is  many  a  mine  that 
could  not  afford  to  ship  at  all. 

Q.  So  that,  as  a  matter  of  fact,  this  system  of  making  one  man  pay 
transportation  of  another  is  absolutely  necessary?  A.  Well,  no;  not 
absolutely  necessary  ;  but,  recollect,  that  in  one  case  the  railroad 
helps  the  low  grade  mine.  We  ought  to  have  some  credit  for  that. 
In  the  other  case,  the  high  grade  man  helps  us,  and  he  ought  to  have 
some  credit  for  that,  and  between  us  'all,  we  keep  things  smooth  and 
get  along  well.  In  this  State  there  are  more  people,  and  they  make 
more  money,  and  things  flourish  ;  and  if  we  did  not  do  so,  they  would 
not  flourish.     We  are  like  the  bricks  in  a  house. 

Q.  Why  can't  the  same  rule  obtain  in  railroads  as  obtains  in  ship- 
ping? I  understand  that  they  take  either  in  weight  or  by  measure 
all  of  the  same  class,  and  pay  the  same  amount  of  money  for  it.  For 
instance,  if  they  are  shipping  thirty-dollar  ore,  whatever  the  shipper 
carries  that  for,  he  will  not  charge  any  more  for  carrying  fifty-dollar 
ore,  or  sixty  or  a  hundred-dollar  ore.  It  is  so  much  a  ton.  The 
value  of  the  goods  cuts  no  figure?  A.  You  do  not  mean  to  tell  me 
that  a  ship  will  bring  rails  and  pig  iron  at  the  same  rate  ? 

Q.  Pig  iron  is  pig  iron  and  rails  are  rails.  If  steel  rails  were  made 
of  a  particular  fineness,  and  might  cost  a  little  more  than  any  other, 
still  they  would  both  pay  the  same  freight  per  ton,  and  the  same  for 
instance  with  silks — silks  at  $1  a  yard  and  $5  a  yard — and  they  would 
pay  the  same  price  per  ton  or  by  measure.  That  is  my  understand- 
ing of  the  shipping  rule  for  ships. 

Senator  Cross — May  I  call  your  attention  to  the  matter  that  the 
consignor  is  insured  against  loss  by  water,  which  is  not  the  case  by 
rail. 

Q.  If  you  say  that  this  is  an  insurance  business?  A.  A  ship,  as  I 
understand  it,  is  a  common  carrier  just  the  same  as  a  railroad,  as  far 
as  that  is  concerned. 

Senator  Cross — No ;  they 


40 

Senator There  are  marine  insurance  companies  for  that 

purpose. 

Senator  Sullivan — Let  us  take  it,  then,  that  these  extra  charges 
are  for  insurance;  then  the  thing  will  not  work  at  all ;  the  rate  is 

too  high,  because  you  can,  even  if  a  train  is  wrecked .     Well,  I 

am  going  off  on  an  argument.  One  of  your  propositions  is,  that  if  a 
train  is  wrecked  you  would  have  to  pay  for  it  if  it  got  ditched,  and  so 
on.  Suppose  that  the  ore  is  not  lost,  even  if  it  is  ditched.  It  is 
there. and  you  can  pick  it  up  again  ?  A.  By  the  time  it  got  down 
into  one  of  those  fills  twelve  or  fifteen  hundred  feet,  I  don't  think 
there  would  be  much  picking  up  to  be  done.  We  paid  some  four- 
teen or  fifteen  hundred  dollars  for  the  loss  of  the  ore  of  which  I  just 
spoke. 

Q.  But  that  is  not  always  the  case?  A.  That  is  generally  the  case 
with  those  things.  Those  things  generally  happen  in  a  bad  place. 
If  you  have  two  horses  and  one  of  them  dies,  it  is  generally  the  best 
one,  and  that  is  about  the  case  with  railroads. 

Q.  Then  a  party  might  relieve  the  railroad  company  by  insuring 
his  own  goods,  and  if  he  did,  then  this  discrimination  should  cease? 
A.  No;  because,  as  I  said  before,  this  insurance  cuts  but  a  very  small 
figure  in  the  case. 

Q.  It  is  not  a  very  material  figure?  A.  It  might  in  some  special 
cases,  say,  such  as  this  silk  business.  There  it  might  be  a  factor.  I 
think  the  chances  are  that  the  railroad  company  might  carry  that 
freight  for  less  money  if  they  were  freed  from  responsibility.  I  don't 
see  but  any  shipper  would  be  willing  to  make  a  difference  in  the 
freight  if  he  was  freed  from  insurance.  I  don't  think  I  would  charge 
as  much. 

Q.  You  say  that  you  warit  to  help  out  everybody,  and  in  order  to 
take  the  low  grade  ore  as  well  as  the  high  grade,  you  discriminate  a 
little  and  shift  the  profits  around.  Supposing  that  your  road  was 
running  through  a  well  settled  country,  and  that  there  was  business 
at  both  ends  and  all  along  the  line,  then  that  discrimination  would  not 
be  necessary,  would  it?  A.  It  depends  upon  what  you  would  be 
shipping  in  that  country. 

Q.  Supposing  that  it  was  all  ore,  and  that  you  had  to  find  out  the 
cost  of  moving  the  whole  of  it  at  so  much  per  ton  ;  a  certain  profit 
on  this  is  all  that  you  would  want?    A.  Yes,  sir. 

Q.  Supposing  that  there  was  plenty  of  ore,  then  there  would  be  no 
necessity  of  making  these  shifting  valuations?     A.  No,  sir.     . 

Q.  You  would  simply  charge  a  fixed  price  per  ton  on  ore  the  same 
as  you  would  on  wheat?  A.  I  dare  say  that  would  be  the  proposi- 
tion. 

Q,  There  would  be  no  necessity  in  that  case  for  discrimination  or 
for  shipping  at  lower  figures?  A.  If  it  could  be  fixed  so  as  to  be  sat- 
isfactory to  the  shipper  the  railroad  would  have  no  trouble. 

Q.  The  price  or  the  value  of  the  thing  would  not  really  enter  into 
the  matter  as  a  material  factor  in  fixing  the  rate  of  the  freight?  A. 
Asa  general  proposition,  no;  but  there  are  so  many  things  connected 
with  this  that  there  is  no  man  who  wishes  or  wants  us  to  do  like  that. 
It  is  a  difficult  thing  to  handle.     I  think  that  is  the  case  with  every- 


41 

body  that  undertakes  to  do  it.  As  far  as  our  roads  are  concerned,  we 
have  three  or  four  of  thern,  and  we  stand  in  and  help  everybody,  and. 
want  everybody  to  help  us.  We  all  want  to  Jive.  We  don't  believe 
in  trying  to  ask  people  anymore  than  Ave  think  they  are  entitled 
to  pay  us.  Nor  do  we  think  that  we  should  work  for  the  people 
for  nothing.  When  a  railroad  goes  into  a  country  it  makes  great 
changes;  it  treads  on  somebody's  toes.  Other  people  get  rich  from, 
it.  We  are  surrounded  with  a  great  deal  of  difficulty.  The  propo- 
sition is  that  railroads  want  a  fair  rate  of  freight  and  means  for 
handling  the  freight  rapidly  and  satisfactorily  to  themselves  and 
their  patrons.  I  would  like  to  suggest  that  a  railroad  company  is 
something  like  a  merchant.  If  a  man  comes  into  his  store  he  will 
treat  him  civilly  in  selling  his  goods  to  him,  and  do  the  best  he  can 
with  him,  and  he  wanfe  the  man  to  pay  him;  and  that  is  the  way 
that  we  attempt  to  do  business.  The  railroads  have  done  a  great  deal 
of  business  in  the  country  as  a  general  thing,  and  I  am  satisfied  that 
it  would  be  a  very  poor  section  of  country  wdiere  we  are  if  it  were 
not  for  the  railroads. 

Q.  Don't  you  think  that  the  country  has  done  well  by  the  rail- 
roads, too?  A.  It  has,  in  a  great  many  respects.  We  always  have 
noticed  this:  That  whenever  we  have  gone  into  the  building  of  a 
railroad  through  a  country,  they  come  to  us  and  say,  "Build  your 
road,  for  we  want  it,  and  it  is  just  what  we  want."  We  come  here, 
and  by  and  by  somebody  commences  to  growl,  and  I  find  that  it  is 
generally  some  new  man  that  has  come  in,  who  don't  know  anything 
about  the  troubles  that  they  had  before  the  railroad  was  built;  and 
then  perhaps  another  new  man  comes  in  from  the  East,  and  he  is 
dissatisfied,  and  so  that  is  the  way  that  the  thing  goes.  If  we  make 
a  success,  then  we  rob  somebody;  if  we  make  a  failure,  they  say  that 
we  were  fools  for  ever  having  had  anything  to  do  with  it.  That  is 
about  the  way  that  the  thing  goes.  'We  have  been  in  both  of  these 
boats,  exactly,  with  our  roads.  My  theory  about  this  whole  business 
is,  that  if  the  bill  is  to  be  introduced  to  keep  us  railroad  people 
straight  and  to  satisfy  the  people  (and  we  always  find  the  people 
pretty  square  sort  of  fellows  in  general,  if  you  get  at  them  right),  it 
will  stop  railroading  so  that  we  can't  do  any  work  or  any  business, 
and  do  it  satisfactorily. 

Senator  Whitney— As  I  understood  you  this  morning,  your  idea 
was,  that  by  discriminating  in  price  between  low  and  high  grade 
ores,  you  would  enable  the  country  to  fill  up,  and  population  to  come 
in  ?     A.  Yes,  sir. 

Q.  You  thought  that  you'would  get  a  return  from  the  high  grade 
ore,  and  from  return  freights,  for  the  community?     A.  Yes,  sir. 

Q.  And  you  understand  those  are  the  reasons  why  discrimination 
should  be  practiced  by  the  railroad  company?  A.  Very  frequently; 
most  generally. 

Q.  If  you  understand  the  provisions  of  this  law  it  will  be  binding 
at  all  times  ?     A.  Yes,  sir. 

Q.  And  not  allow  you  any  discrimination  ?  A.  I  understood  so 
this  morning. 

Q.  I  understood   you  to  say  this  morning  that  if  this  law  were 


42 

carried  out  you  could  not  carry  on  your  business  but  that  in  the 
instances  given  you  would  not  be  afraid  that  a  jury  would  convict  you 
of  an  infraction  of  the  law?  A.  The  idea  that  I  had  was  this:  that 
arose  from  the  question  of  taking  this  poor  man's  furniture,  and  I 
said  that  if  I  did  I  did  not  believe  that,  even  if  it  were  in  the  face  of 
this  law,  no  Judge  and  jury  would  convict  me. 

Q.  But  if  you  thought  there  would  be  a  swift  conviction  in  every 
such  case,  would, your  view  be  that  you  could  carry  on  railroad  busi- 
ness ?    A.  No,  sir. 

Q.  You  would  have  to  rely  on  the  discretion  of  the  community 
who  dispensed  the  law,  or  else  you  could  not  carry  on  business 
under  it?  A.  Well,  it  would  be  almost  that.  I  think  that  the  people 
themselves,  in  a  great  many  cases,  would  complain  that  it  was  injur- 
ing the  road,  and  injuring  everybody,  and  if"there  was  nothing  else 
to  be  done  they  would  petition  the  next  Legislature  to  vacate  the 
bill. 

Senator  Spencer — With  reference  to  the  risk  in  transporting 
freight  by  water  and  by  railroad,  do. you  know  about  what  the  dif- 
ference is  considered  ?  Whether  greater  or  less  in  comparison  with 
the  other,  and  which  it  is  in  favor  of?  Suppose  you  ship  goods  from 
New  York  by  sea,  or  ship  them  overland  to  California,  and  that  you 
went  to  an  insurance  office  to  get  insurance  upon  them  ;  would  one 
be  cheaper  than  the  other?     A.  I  think  so. 

Q.  About  what  proportion?  A.  I  don't  know;  it  must  be  very 
great. 

Q.  This  morning  you  stated  that  you  thought  that  this  bill  was  not 
in  some  respects  a  good  bill?     A.  Portions  of  it. 

Q.  What  are  the  prominent  features  of  this  bill  which  you  con- 
sider would  be  inimical  to  the  interests  or  interfere  with  the 
interests  of  the  railroad  company?  A.  I  think  that  this  section 
(number  one)  that  is  where  I  would  want  that  inserted. 

Q.  Is  it  not  a  universal  rule  that  railroad  companies  charge  all 
that  the  goods  will  bear,  so  to  speak  ?  A.  No;  at  the  present  time 
Ave  are  not  charging  all  that  the  law  allo.ws  us. 

Q.  I  understood  you  to  say  that  if  you  were  shipping  ore  that  was 
worth  ten  dollars  a  ton  and  other  ore  that  was  worth  thirty  dollars  a 
ton,  that  you  would  make  a  difference?    A.  I  do. 

Q.  That  is  based  solely  upon  the  question  of  risk?  It  don't  cost 
any  more  to  put  in  a  ton  of  ore  worth  thirty  dollars  than  one  that  is 
worth  ten?    A.  Certainly  not. 

Q.  It  takes  just  as  many  men  to  handle  it  and  just  as  much  work 
to  transport  it?    A.  Yes,  sir. 

Q.  Then  the  only  factor  that  enters  into  that  is  the  risk  in  the 
event  of  loss  ?     A.  No,  sir. 

Q.  Isn't  that  the  only  factor  that  ought  to  be  considered  ?  A.  No, 
sir.  I  told  you  the  reason  why  we  classified  ore?.  I  don't  know  that 
you  were  in  here. 

Q.  Yes,  sir;  I  heard  you  say  it  was  to  encourage  other  business? 
A.  Mines  have  low  grade  ore  which  could  not  be  shipped  at  all  were 
it  not  for  the  rate  which  the  high  grade  will  bear.  Now  we  are  enti- 
tled to  five  cents  per  ton  and  ten  cents  for  passengers.     That  is  the 


43 

limit  in  the  State  of  California.  We  do  not  charge  up  to  that  limit 
even  with  this  discrimination  of  ours  that  we  were  talking  about; 
we  don't  work  up  to  that.  In  Nevada  we  are  entitled  to  twenty  cents 
per  ton  per  mile,  and  our  average  is  not  ten  on  our  freights.  Now, 
by  this  classification  or  discrimination  in  ores  we  enable  these  men 
to  go  and  keep  their  properties  at  work.  We  extend  to  poor  men  in 
that  country  our  tariff  from  time  to  time  and  from  month  to  month 
on  their  low  grade  ore,  but  we  hope  some  of  these  days  to  get  rich 
ore.  Now,  if  they  could  not  dispose  of  those  low  grade  ores  to  enable 
them  to  pay  expenses,  and  that  is  what  we  are  doing  all  over  Inyo 
County — we  have  over  seven  hundred  mines  that  have  been  recorded 
there,  as  well  as  a  great  many  that  are  working  that  have  never  been 
recorded,  and  some  with  only  small  tunnels,  etc.  And  now  we  have 
gone  into  Inyo  with  this  road,  and  a  great  many  of  these  places  that 
have  been  abandoned  as  being  too  poor  to  pay  for  working  have 
started  up,  and  we  are  bringing  out  silver  and  lead  and  are  enabling 
miners  to  work  these  low  ores.  In  cases  of  that  kind,' when  a  man 
comes  to  us,  we  say,  "  We  will  take  this  ore  at  cost  to  us,  or  with  very 
little  profit,  but  if  you  have  any  high  grade  ore  we  will  want  you  to 
pay  a  higher  rate."  And  when  he  comes  to  us  with  $1,500  ore  we  ship 
it  at  a  higher  rate,  say  $10  a  ton  more  than  the  other.  By  doing 
that  the  community  exists  and  lives  and  moves,  and  we  are  able  to 
go  on  with  our  road,  and  the  more  work  we  do  of  that  kind  of  course 
the  cheaper  we  can  do  our  work.  That  is  another  thing  that  benefits 
the  people,  of  course,  and  the  whole  of  this  proposition  benefits  them. 
We  are  taking  the  position  that  by  and  by,  through  the  opening  up  # 
of  these  mines  which  we  believe  to  exist  in  that  country,  that  the 
business  will  improve,  and  the  business  grow  better,  and  we  will  do 
a  larger  business,  and  the  whole  country  will  be  benefited.  If  that 
can't  be  done  then  we  are  losers,  that  is  all  there  is  about  that. 

Q.  Then  I  understand  you  that  as  a  business  proposition  that  the 
rapid  development  of  the  country  and  the  benefits  to  the  people  are 
the  two  grounds  upon  which  you  base  the  reasons  for  charging  differ- 
ent rates  upon  the  two  grades  of  ore,  and  for  discriminating  between 
the  rates.  About  what  difference  do  you  make  in  the  two  grades? 
A.  We  would  make  perhaps  twelve  and  a  half  or  thirteen  dollars. 

Q.  And  you  say,  as  a  business  proposition,  that  that  forwards  the 
development  of  the  country?     A.  That  is  the  ground  that  I  take. 

Q.  Outside  of  that  special  instance,  as  regards  ore,  upon  what 
principle  is  a  railroad  man  justified  in  charging  that  difference  in 
goods,  generally  of  the  same  class  or  of  the  same  kind;  take  any 
other  goods  of  the  same  kind  or  character,  that  require  the  same 
time,  and  are  of  the  same  bulk,  and  the  same  trouble  in  transporta- 
tion, the  same  labor  and  the  same  capital?  Outside  of  the  risk,  is 
there  any  other  factor  that  enters  into  it?  A.  lean  hardly  answer 
that  question. 

Q.  No,  sir.  Now  that  is  your  chief  objection  to  this  Barry  bill. 
That  is  the  fatal  objection  to  it,  is  it  not?  A.  That  is  one  of  them. 
As  I  said  before,  in  looking  it  over,  I  think  that  the  proposition 
should  go  into  the  whole  bill,  "of  the  same  class  or  kind,"  wherever 
that  occurs. 


44 

Q.  Suppose  that  you  had  to  point  out  one  objection,  would  you  con- 
sider that  the  fatal  objection?  A.  It  is  a  very  strong  objection.  I 
don't  know  that  it  is  the  fatal  objection. 

Q.  So  far  as  the  profits  of  the  road  and  the  developments  of  the 
country  are  concerned,  that  would  be  very  objectionable?  A.  That 
would  be  very  objectionable,  would  it  not? 

Q.  Well,  you  are  answering  questions,  and  I  am  not?  A.  That  is 
one  of  the  principal  objections,  and  another  is  as  to  posting  a  tariff 
at  all  stations. 

Q.  You  want  that  changed  so  that  you  will  not  have  to  get  the 
whole  printed  ?  A.  Get  a  volume  of  a  thousand  pages,  and  you  have 
got  a  lot  of  things  that  the  public  do  not  want  to  know. 

Q.  I  understood  you  to  say  to  Senator  Brooks,  that  if  the  charge 
was  to  be  upon  goods  to  be  shipped,  say  from  Virginia  City  to  some 
other  point  in  the  State,  say  one  hundred  miles  away,  you  should  be 
required  to  furnish  a  schedule  only  between  the  two  points?  A.  That 
is  the  proposition. 

Q.  That  is  the  only  objection  to  that?  A.  And  have  it  within  the 
State. 

Q.  You  would  not  have  any  objection,  in  case  we  had  to  ship 
through  another  State,  to  furnish  a  through  schedule?  A.  If  we 
went  into  another  State  we  would  have  another  law  to  operate  under, 
and  another  rate  of  freights,  and  we  might  go  to  work  and  get  a  rate 
that  we  could  not  carry  under  by  that  law  without  loss.  If  the  agent 
at  Virginia  City  wanted  to  ship  to  San  Francisco,  and  he  didn't  know 
what  the  rate  was,  he  would  have  to  say,  "You  will  have  to  wait 
till  I  can  ascertain  and  let  you  know." 

Q.  If  you  had  an  understanding  with  another  company  through 
or  by  which  you  ship  this  freight,  you  could  get  at  it?  A.  It  says 
that  you  must  do  it. 

Q.  Supposing  that  you  wanted  to  ship  it  through  that  route,  you 
could  made  a  contract,  couldn't  you,  with  the  consignor  of  the  goods? 
A.  Certainly  j  that  is  another  thing. 

Q.  If  you  undertook  to  contract  you  would  carry  them  at  contract 
price,  wouldn't  you?    A.  Yes;  but  it  might  take  time. 

Q.  You  would  not  be  contracting  to  take  the  goods  to  San  Fran- 
cisco unless  you  knew  what  you  were  to  pay?  A.  There  are  cases 
occurring  that  we  don't  know  what  the  rates  to  San  Francisco  are,  as 
a  matter  of  fact,  and  we  ship  copper  bullion  and  lead  and  that  sort 
of  thing  to  New  York,  and  the  charges  are  constantly  shifting.  I 
think  there  is  every  reason  in  the  Avorld  why  the  tariff  should  be 
confined  to  the  State. 

Senator  Sullivan — About  that  printed  schedule.  Do  you  change 
your  rates  often?  A.  These  rates  are  changed  frequently;  sometimes 
one  or  two  or  three  a  day.  I  dare  say  that  the  Central  Pacific  Rail- 
road Company  must  change  a  dozen  a  day. 

Q.  How  does  that  come?  A.  There  are  new  kinds  of  freight 
offered  to  them. 

Q.  Those  are  additional?  A.  .Different  kinds  and  lots.  A  great 
many  things  of  that  kind  are  occurring  every  day. 


45 

Q.  You  would  not  change  your  schedule  for  staple  articles  every 
day?    A.  That  would  probably  stand. 

Q.  Those  are  permanent?  A.  Of  course  a  great  many  would 
stand. 

Q.  I  suppose  that  any  changes  that  would  be  made  would  not  be 
necessary  more  than  once  in  six  months,  simply  to  correct  errors,  or 
to  add  new  goods  that  were  not  on  the  original  schedule?  A.  Yes, 
sir. 

Q.  Would  the  cost  of  printing  a  schedule  be  a  large  item?  A. 
Yes.  sir;  it  would. 

Q.  The  first  cost  would  be  much  greater  than  any  subsequent  cost? 
A.  I  presume  that  is  so,  of  course. 

Q  It  would  cost  almost  as  much  to  print  fifty  or  sixty  as  to  print 
a  thousand?     A.  Of  course  not,  after  the  type  is  set. 

Q.  The  original  cost  is  the  principal  cost?     A.  That  is  it'. 

Q.  Then  any  duplicate  of  the  schedule  would  not  be  much  of  a 
hardship  upon  the  railroad  company.  I  understand  that  you  have 
no  serious  objection  to  section  three  (reading  it)?  A.  iSTo,  sir;  not 
the  slightest,  except  to  the  latter  part. 

Q.  What  is  your  objection  to  the  latter  part  of  that  section,  if  it  is 
taken  in  connection  with  the  whole  section  ?  A.  The  point  is  this, 
if  there  is  a  station  closed  and  it  is  found  well  to  have  another  one  a 
few  miles  away,  if  the  company  attempted  to  remove  the  structure 
they  would  be  going  contrary  to  the  law. 

Q,.  That  is  your  interpretation  of  it?  A.  That  is  what  I  under- 
stand this  bill  to  be. 

Q.  That  is  your  only  objection  to  that?  A.  That  is  the  only  objec- 
tion ;  and  then  if  a  track  is  once  laid  it  can  never  be  taken  up  again. 

Q.  That  is  your  statement  as  a  conclusion?  A.  That  is  what  I 
understand  this  bill  to  be;  and  if  that  is  done  the  company  will  lose 
its  charter.  Of  course  I  have  reference  to  the  side  tracks,  running 
off  on  the  outside  to  outside  camps,  and  outside  places  where  it  might 
be  found  to  the  interest  of  the  railroad  company  to  take  up  that 
track,  and  under  this  law  they  could  not  do  it. 

Q.  Now  you  have  what  objection  to  section  seven  (reading  it)? 
You  observe  there  that  before  any  forfeiture  can  be  had  the  railroad 
company  can  have  its  day  in  Court?     A.  I  presume  so,  of  course. 

Q.  There  cannot  be  a  forfeiture  until  there  has  been  a  regular 
adjudication  of  the  matter  before  a  competent  tribunal — I  am  only 
reading  down  to  the  word  "  Attorney-General?  "  A.  The  presump- 
tion would  be  that  if  a  person  were  operating  a  road  under  this  bill, 
and  there  was  an  infraction,  that  the  charter  would  be  destroyed  the 
moment  that  the  Attorney-General  commenced  the  suit.  It  would 
be  a  foregone  conclusion  that  he  would  win  his  case  or  else  he  would 
not  want  to  bring  one. 

Q.  That  is  your  idea  of  the  capacity  of  the  Attorney-General  of 
this  State  ?     A.  That  is  about  it. 

Senator  Vrooman — I  move  that  the  remarks  be  taken  down. 

Q.  That  is  your  construction  of  that  section?  A.  If  I  voted  for 
that  bill  I  would  expect  that  to  be  the  construction. 

Q.  (Reading  same.)     Do  you  understand  by   that  that  this  is  a 


46 

declaratory  statute  ?  A.  I  don't  mean  by  that  that  a  man  is  going 
to  run  his  case  before  the  rule  commences.  I  don't  want  the  rule  to 
commence. 

Q.  You  don't  want  the  railroad  tried  for  forfeiture  at  all?  A.  No; 
I  don't  take  that  ground,  but  that  is  one  of  the  reasons. 

Q.  Do  you  not  understand  that  a  railroad  is  at  all  times  entitled  to 
a  hearing  in  a  Court  of  justice,  and  that  there  can  be  no  forfeiture 
till  there  has  been  an  adjudication?  A.  Of  course  I  understand 
that,  but  I  don't  want  to  get  into  the  Courts. 

Q.  (Reading  balance  of  section.)  Have  you  any  objection  if  any 
of  the  employes  of  your  railroad  company  disobey  the  order  of  the 
company  to  their  being  punished  for  a  misdemeanor?  A.  None 
whatever. 

Q.  If  the  railroad  company  should  authorize  the  violation  of  the 
statute,  don't  you  think  that  they  ought  to  be  both  punished  ?  They 
would  be  particeps  criminis,  wouldn't  they  ?     A.  Yes,  sir. 

Q.  You  do  not  understand  that  this  last  section  operates  an}T  for- 
feiture of  the  charter  at  all?  A.  To  the  charter?  If  I  understand 
the  law  rightly  any  officer  of  the  road  breaking  the  law  is  not  per- 
sonally criminal  in  the  way  that  you  speak  of,  but  that  as  a  conse- 
quence the  railroad  company  would  suffer  for  it,  and  that  they 
Avould  lose  their  charter.  No  doubt  they  are  running  these  things, 
or  else  they  could  not  lose  their  charter. 

Q.  Do  you  understand  that  the  last  part  of  this  section  has  any 
reference  to  the  company  losing  its  charter  in  any  sense  of  the  word? 
A.  Most  unquestionably; 'because  the  moment  you  find  that  the 
people  of  the  railroad  had  done  this  thing,  the  railroad  must  lose  its 
charter. 

Q.  That  is  your  construction  of  it?  A.  It  is  the  agent  of  the  com- 
pany that  does  these  things.     The  company  itself  can  do  nothing. 

Q.  Then  if  the  company  itself  do  these  things  is  it  not  perfectly 
right  that  they  should  be  punished,  and  if  the  punishment  be  that 
they  shall  forfeit  their  charter  if  they  do  the  same,  that,  it  shall  be 
forfeited?  A.  If  the  company  authorizes  their  agent  to  do  anything 
unlawful  they  ought  to  be  punished. 

Q.  We  agree  on  that  then?    A.  Yes,  sir. 

Q.  If  the  servants,  or  agents,  or  employes  do  it,  they  ought  to  be 
punished,  and  not  the  company?  A.  Yes,  sir ;  we  would  not  have 
any  law  for  the  company  unless  that  was  done. 

Q.  Do  you  insure  any  shipments  of  freight  for  transportation;  I 
mean  in  the  company's  offices?     A.  We  never  insure  at  all. 

Q.  Will  you  tell  me  the  reason  of  the  rule  why  railroad  companies 
as  a  general  thing  do  not  insure?  A.  They  become  their  own 
insurers.  It  is  on  the  same  principle  that  the  shipowner  who  has 
nine  hundred  ships  does  not  insure.  He  can  afford  to  lose  three  or 
four  ships'a  year  rather  than  to  pay  the  insurance  on  the  whole. 

Q.  Is  not  the  reason  this:  that  your  loss  in  proportion  to  the  ship- 
ments is  very  light  in  proportion  to  the  goods  you  carry?  A.  I  sup- 
pose that  it  is,  yet  the  proportion  of  loss  is  not  small.  If  the  railroad 
company  should  lose  a  valuable  train — and  it  is  one  of  those  things 


47 

that  very  frequently  happen  to  trains  that  pass  over  their  roads — their 
loss  would  be  very  great. 

Q.  Your  road  has  come  into  this  State  within  the  last  year?  A. 
Yes,  sir. 

Q.  How  far?     A.  One  hundred  and  seven  miles. 

Q.  What  is  the  name  of  your  road?     A.  The  Carson  and  Colorado. 

Q.  How  far  is  it  constructed  in  the  State  of  Nevada?  A.  About 
one  hundred  and  ninety  miles. 

Q.  What  was  the  cost  of  running  your  road  last  year  in  the  State 
of  Nevada?     A.  I  cannot  tell  you  exactly. 

Q.  Do  you  know  approximately?  A.  I  think  the  net  income  is 
somewhere  about  three  hundred  thousand  dollars. 

Senator  Vrooman — I  do  not  see  the  relevancy  of  this. 

Senator We  put  it  upon  the  ground  that  it  is  a  private  and 

not  a  public  matter. 

Senator  Spencer — This  bill,  in  some  respects,  is  a  bill  to  regulate 
freights  and  fares,  and  it  seems  to  me  that  the  earnings  of  the  road 
would  throw  some  light  on  that  subject.  I  understand  that  it  has 
not  been  in  operation  here  long  enough  to  tell  anything  about  it. 
A.  Only  about  six  months,  in  this  State.  I  will  answer  any  question 
any  gentleman  asks,  and  come  as  near  as  I  can  to  the  true  facts,  in 
regard  to  all  these  matters,  and  I  wish  to  say  that  I  have  been  look- 
ing at  my  returns,  that  we  have  finished  one  hundred  and  seven 
miles  in  the  State  of  California,  from  the  State  of  Nevada,  within  the 
last  year.  I  am  making  up  a  statement  to  put  before  the  Board  of 
Equalization  to  show  what  we  are  doing  in  this  State. 

Q.  You  are  not  prepared  with  figures  to  answer  the  question  ?  A. 
No,  I  cannot;  I  thought  this  bill  was  a  bill  to  regulate  freights  and 
fares. 

Q.  I  understand  that,  as  a  railroad  man  engaged  in  the  operation 
of  railroads,  your  mind  has  undergone  some  changes,  in  reference 
to  this  bill,  since  you  have  examined  it?  A.  Only  in  this  first  sec- 
tion. I  said  this  morning  that  in  the  way  of  freight,  I  believed  that 
freights  ought  to  be  classified.  You  will  bear  me  out  in  that;  and  I 
wish  to  be  understood  that  I  think  that  proposition  ought  to  be  fol- 
lowed all  the  way  through  the  bill.  The  next  question  that  came  up 
was  in  regard  to  quantities.  If  you  remember  a  gentleman  asked  me 
this  morning,  in  regard  to  carloads  of  oranges,  and  all  those  things, 
and  I  think  my  answers  were  on  that  proposition.  I  admitted  that 
I  had  gone  over  these  things  very  hastily,.and  of  course  I  answered 
them  very  rapidly,  and  answered  them  off-hand,  but  I  answered  them 
entirely  with  reference  to  straight  carloads,  because  that  is  the  kind 
of  business  we  are  doing.  But  when  a  company  has  a  great  deal  of 
freight  that  must  be  delivered  in  large  places  like  San  Francisco, 
then  it  would  be  very  difficult  for  companies  to  handle  those  small 
lots  in  rotation.  In  other  words,  if  they  have  straight  carloads  they 
can  take  them  to  whatever  destination  they  are  to  go,  and  if  they  can 
take  them  in  that  way  they  can  put  a  less  rate  on  the  freight  of  the 
public,  but  if  they  are  to  carry  the  same  cars  to  fifteen  or  twenty  men, 
it  is  divided  up,  and  of  course  takes  more  time.  That  question  of 
small  lots  Mas  not  brought  up  at  all.     We  were  talking  of  straight 


48 

carloads,  and  we  do  our  business  principally  in  that  manner.  So  far 
as  framing  a  schedule  is  concerned,  I  overlooked  the  fact  that  it  is 
not  pertinent  to  places  outside  of  the  State.  That  is  the  only  objec- 
tion that  I  see  to  it;  but  between  stations  that  is  one  thing  that  the 
station-master  is  for,  in  his  office  all  the  time. 

Q.  Your  rule  in  this  matter  in  the  State  of  Nevada,  is  that  you  do 
not  charge  as  much  for  taking  goods  twenty  miles  as  you  do  for 
taking  them  one  hundred  miles?  A.  I  said  we  did  not  charge  much 
more. 

The  Chairman — It  is  the  same  as  ours?  A.  Yes,  sir;  in  regard 
to  that  it  is. 

Q.  Is  your  road  a  narrow  gauge?  A.  The  Carson  and  Colorado  is  a 
narrow  gauge;  the  Virginia  and  Truckee  is  a  wide  gauge,  and  where 
we  connect  with  the  Central  Pacific  it  is  a  wide  gauge. 

Senator  Sullivan — I  desire  to  know  if,  in  your  experience,  any 
man  or  company  has  been  wronged  by  discrimination  in  Inyo  or 
Mono  Counties,  where  this  road  of  yours  runs?  A.  No,  sir;  I  don't 
know  of  any. 

Q.  As  I  understand  you  then  the  Barry  bill,  with  these  few  changes 
that  you  have  pointed  out,  is  in  your  opinion  a  good  bill?  A..  It 
would  not  be  unsatisfactory. 

Q.  If  this  change  were  not  made  in  section  one,  so  as  to  put  in 
"of  the  same  class  or  kind,"  then  it  would  be  extremely  unsatisfac- 
tory?    A.  We  could  not  do  business  at  all. 

Q.  That  is,  if  you  could  not  discriminate  between  different  owners? 
A.  That  is  it. 

Q.  As  you  understand  it  now  it  provides  for  no  discrimination  as 
regards  persons?    A.  I  understand  that. 

Q.  To  come  down  to  the  point,  I  want  you  to  make  it  clear  to  my 
mind  whether,  in  case  low  grade  ore  is  offered  at  the  same  time  that 
high  grade  ore  is,  you  would  send  the  high  grade  first  and  leave  the 
low  grade  behind  ?  Here,  for  instance,  are  two  carloads — one  of  a  fine 
quality  of  ore  and  the  other  a  base  ore — and  you  classify  them  as  A 
and  B.  Now,  if  that  change  were  made  in  section  one  it  would  ap- 
pear to  me  (I  don't  know  whether  I  am  correct  in  this  or  not,  and  if 
not  I  would  like  to  be)  that  it  would  be  necessary  for  you  to  forward 
class  A,  and  if  another  carload  was  there  of  the  same  class  that  you 
would  have  to  send  it  on  before  you  would  send  class  B?  A.  Pro- 
vided it  was  delivered  first. 

Q.  Who  is  to  judge  of  the  classes  under  this  law;  the  railroad  or 
the  shipper?     A.  I  suppose  they  wrould  have  to  do  it  together. 

Q.  Suppose  that  I  was  a  shipper,  a  miner,  and  that  in  some  way  I 
had  offended  the  Directors  of  the  company  of  the  Carson  and  Colo- 
rado road,  and  they  said  to  me,  "Mr.  Sullivan,  we  don't  want  to  have 
anything  to  do  with  you;  you  can  go  and  ship  your  ore,  if  you 
please,  by  mules,  or  in  any  other  way  you  please,  no  matter  to  us." 
I  know  they  are  discriminating  against  me,  and  they  can  charge  me 
any  price  they  please?    A.  They  can't. 

Q.  Then,  under  this  law,  if  they  are  allowed  to  discriminate  as  to 
a  class,  or  kind,  if  it  be  passed,  and  they  will  be  compelled  to  give  me 
a  show,  and  not  to  crush  me  entirely?     A.  I  am  not  a  lawyer,  and  I 


49 

do  not  understand  the  laws  of  this  State  very  well,  and  I  never  saw 
anybody  that  did.  If  this  wrong  was  done  you  by  the  Carson 
Directors,  it  seems  to  me  that  you  have  got  your  redress  under  the 
law  as  it  now  stands,  just  as  well  as  you  would  have  it  under  this 
bill. 

Q.  Supposing  that  they  would  not  carry  for  you  at  all,  or  charge  you 
a  very  high  price  ?  A.  They  can't  do  that,  because  the  law  says  that 
you  shall  only  be  charged  five  cents  per  ton  per  mile.  You  can't  get 
over  that. 

Q,  Assuming  that  you  wei*e  charged  five  cents  per  ton  per  mile, 
you  know  very  well  that  there  is  a  great  deal  of  ore  that  will  not  pay 
the  shipper  to  ship  at  that  rate?  A.  That  is  true;  it  would  be  a  very 
bad  business,  but  you  can't  compel  the  Directors,  or  anybody  else  con- 
nected with  the  railroads  to  do  so,  because  somebody  else  would  be 
the  sufferer  by  it. 

Q.  Do  you  know  anything  about  the  special  contracts  of  the  Cen- 
tral Pacific  Railroad  with  the  merchants  of  San  Francisco?  A.  I 
have  heard  of  them;  I  don't  know  anything  about  them. 

Q.  You  have  no  knowledge  of  any  special  contract  system  on  your 
line,  whereby  you  can  discriminate  in  favor  of  one  man  and  against 
another?  A.  We  don't  do  that  class  of  business. .  If  we  have  a  quar- 
rel with  a  man,  we  try  to  treat  that  man  better  than  we  do  any  other, 
so  as  to  show  him  that  we  are  not  so  bad  as  he  thinks  we  are. 

Q.  Now  as  to  section  two  ;  you  would  make  such  changes  as  would 
be  needed  by  the  agent  only  at  points  within  the  State  ?    A.  Yes,  sir. 

Q,  Don't  you  think  that  a  railroad  corporation  should  be  treated 
just  the  same  as  a  natural  person?    A.  Yes,  sir. 

Q.  Upon  the  principle  we  were  arguing  just  now  ?     A.  Yes. 

Q.  Then  if  a  railroad  company  follows  the  principle  invoked,  and 
should  commit  an  infraction  of  the  law,  don't  you  think  that  the 
corporation  should  suffer,  just  as  a  natural  person  would,  for  such 
infraction  of  the  law  ?    A.  Yes,  sir. 

Q.  But  you  think  that  if  it  does  so,  it  ought  not  to  lose  its  charter? 
A.  No,  sir  ;  because  an  agent  might  be  annoyed  at  the  company  and 
do  these  things  purposely. 

Senator  Vrooman — Do  you  think  that  all  persons  should  be 
treated  alike,  regardless  of  the  kind  of  freight?  A.  No.  The  honor- 
able Senator's  question  was  as  to  the  same  kind  of  freight,  of  course. 

Q.  I  did  not  understand  him  to  say  "the  same  kind  of  freight." 
A.  You  understood  me  in  that  way,  did  you  not? 

Q.  Yes,  sir. 

Senator  Vrooman — Upon  this  question  of  charging  all  that  the 
traffic  will  bear,  what  would  you  charge  for  ore  worth  $500  a  ton, 
between  any  two  points  on  your  railroad  ?  A.  It  ranges  from  ten  to 
fifteen  dollars  to  San  Francisco. 

Q,.  About  what  grade  is  the  ore  for  which  you  charge  fifteen  dol- 
lars?    A.  On  two  hundred  dollar  ore. 

Q.  How  much  more  would  you  charge  for  ore  that  is  worth  $500? 
A.  Not  much. 

Q.  Just  enough  to  make  up  for  the  risk  ?     A.  Yes,  sir. 
4b 


50 

Q.  In  other  words,  there  is  a  limit,  and  when  yon  get  to  it  you 
think  you  are  getting  a  fair  rate?    A.  That  is  it  exactly. 

Q.  As  a  railroad  man,  and  a  man  of  business,  do  you  consider  the 
services  which  you  render  to  a  man  whose  ore  is  worth  five  hundred 
dollars  worth  any  more  than  to  the  man  whose  ore  is  worth  twenty 
dollars,  aside  from  the  benefit  that  you  confer  on  him?  A.  No;  I 
don't  know  that  it  is. 

Q.  Do  you  not  think  that  it  confers  a  greater  benefit  upon  the  man 
whose  ore  is  worth  ten  dollars  a  ton,  than  upon  the  one  whose  ore  is 
worth  twenty  dollars?     A.  Certainly. 

Q.  In  fixing  your  rates  do  you  take  into  consideration  the  value  of 
the  services  that  you  may  render  to  the  man  whose  freight  you 
transport?     A.  To  some  extent. 

Q.  Do  you  think,  as  a  business  man  and  a  railroad  man,  that  it 
would  be  possible  to  carry  on  the  transportation  business  in  this 
State  by  rail,  with  a  uniform  system  for  rates,  unless  the  maximum 
was  so  high  that  it  would  practically  be  of  no  benefit — that  is,  if  you 
had  to  charge  alike  for  all  the  carrying  business — without  destroy- 
ing many  of  the  industries  now  going  on?  A.  If  the  Legislature  of 
this  State  allowed  the  railroad  companies  in  some  cases  to  charge 
fifty  cents  per  ton  per  mile,  it  would  be  a  good  proposition  for  the 
people,  or  if  they  charged  it  per  hundred  pounds. 

Senator  Sullivan — It  does  not  cost  the  railroad  company  any 
more  to  transport  a  ton  of  ore  worth  thirty  dollars  than  it  does  one 
worth  five  hundred  dollars,  so  that  you  do  not  charge  according  to 
the  cost  of  the  services,  but  according  to  the  value  of  the  article? 
A.  A  kind  of  ad  valorem  tax.  I  mentioned  awhile  ago  that  the 
proposition  of  freights  and  tariffs  was  a  difficult  One  to  handle.  Take 
a  road,  for  instance,  only  six  miles  long,  and  it  would  be  one  to  a 
thousand  that  their  different  rates  would  not  be  arranged  so  as  to  be 
satisfactory  to  the  people  and  also  to  the  railroad  company.  The 
longer  you  haul  the  cheaper  you  can  doit.  The  same  thing  applies 
to  the  United  States  mails,  and  everything  else  that  is  taken.  I  don't 
think  that  you  would  find  from  the  business  of  the  company  that  it 
paid  the  best  where  the  most  business  was  done — where  is  the  bulk 
of  the  business.  So  many  things  come  in  that  it  is  difficult  to  ex- 
plain it. 

Q.  A  man  don't  know  where  he  is  till  he  figures  up  at  the  end  of 
the  year  ?     A.  That  is  the  general  way. 

Senator  Spencer — And  he  generally  finds  himself  there?  A.  I 
don't  know  about  that.  I  know  a  great  many  railroads  in  this  State 
that  it  would  be  difficult  to  get  the  cost  of. 

Senator  Sullivan — Isn't  the  true  system  to  charge  according  to 
the  value  of  the  services  rendered,  and  not  according  to  the  value  of 
the  article  shipped;  isn't  that  the  true  system  of  railroading?  A.  I 
think  that  they  ought  both  be  taken  into  consideration. 

Q.  I  mean  the  cost  of  the  services  rendered?  A.  I  think  that  the 
value  of  the  articles  handled  and  the  amount  of  the  work  done  by 
the  railroad  company  should  both  be  taken  into  consideration. 

Q.  Why  should  the  value  of  the  article  be  taken  into  considera- 
tion?   A.  For  various  reasons  that  we  have  been  discussing  here  to- 


51 

■day.  It  is  proper  and  natural  to  put  the  best  property  in  the  best 
kind  of  cars,  expensive  cars,  and  various  matters  of  that  kind  come  in. 

Q.  When  the  United  States  pays  an  ad  valorem  tax  on  things,  it 
does  not  take  into  consideration  the  cost  of  those  things,  but  simply 
pays  it  for  the  purpose  of  getting  a  revenue?  A.  They  take  into 
consideration  the  fact  of  whether  a  thing  is  a  luxury  or  otherwise. 

Q.  They  get  in  a  certain  amount  of  taxes.  If  you  have  the  idea 
in  your  mind  of  getting  in  a  certain  amount  of  revenue,  do  you 
figure  simply  the  cost  of  moving  the  articles  and  getting  a  fair  profit 
upon  them?  A.  If  I  understand  you  rightly,  they  consider  both  the 
cost  and  the  value  of  them.  They  both  come  under  the  proposition, 
•as  I  said  before. 

Senator  Spencer— Do  railroad  companies  charge  more  for  carry- 
ing ores  that  are  worth  a  thousand  dollars  a  ton  than  for  those  worth 
a  hundred  dollars  a  ton?     A.  Certainly. 

Q.  That  is,  on  the  basis  of  risk  in  case  of  loss?    A.  Yes,  sir. 

Q.  Do  they  charge  any  more  for  shipping  a  small  man  than  for  a 
large  one?  A.  No,  sir;  we  don't  ship  men  by  the  value,  the  same  as 
we  do  horses;  if  we  did  some  of  them  would  not  have  any  value. 

Senator  Cross — It  occurs  sometimes  in  California  that  some  men 
of  great  value  have  been  carried  for  nothing?     A.  I  have  heard  so. 

Senator  Cross — Will  you  look  at  section  seven,  which  provides 
that  "any  railroad  corporation  violating  the  provisions  of  sections 
one,  three,  and  four  of  this  Act  shall  forfeit  its  charter  and  corporate 
privileges;"  and  then  look  at  section  six,  which  reads:  "  On  the  expi- 
ration or  forfeiture  of  the  charter  of  any  railroad  corporation,  its 
road,  and  appurtenances,  and  right  of  way  acquired  by  it,  remain 
vested  in  the  people  of  the  State,  for  public  use,  and  its  other  property 
shall  be  sold,  and  the  proceeds,  after  payment  of  its  debts  and  liabil- 
ities, divided  among  the  stockholders."  I  desire  now  to  ask  you  this 
question  as  leading  up  to  some  others:  By  whom,  on  behalf  of  a  rail- 
road company,  is  its  business  transacted  at  the  various  stations  along 
its  line?     A.  By  agents. 

Q.  Now,  look  at  section  one,  which  provides  that  freight  must  be 
forwarded  in  the  order  in  which  it  is  received.  Does  it  ever  occur 
that  those  agents  become  hostile  to  the  interests  of  the  company? 
A.  Very  seldom;  it  sometimes  happens. 

Q.  Supposing  that  under  such  circumstances  the  authorized  agent 
of  the  railroad  company  should  violate  this  provision  of  the  law,  and 
forward  a  carload  of  freight,  which  was  received  second  in  order,  in 
preference  to  a  carload  received  first;  can  a  person  do  so  if  so  minded? 
A.  Certainly. 

Q.  Without  any  special  direction  from  the  Board  of  Directors?  A. 
Certainly. 

Q.  Suppose  that  the  agent  of  the  company  was  furnished  with  all 
these  printed  forms,  and  that  some  man  should  apply  to  him,  and 
that  he  refused  to  furnish  Vie;  do  you  think  that  might  transpire 
under  the  provisions  of  this  law?     A.  Yes,  sir. 

Q.  What  is  the  value  of  the  rolling  stock  of  your  road  ?  A.  Prob- 
ably $100,000. 

Q.  What  is  the  total  valuation  of  your  road  ?    A.  About  $3,000,000. 


52 

Q.  Then,  under  this  bill,  if  one  of  your  agents  became  hostile  to 
the  interests  of  the  company  and  forwarded  a  carload  of  freight  out 
of  its  order,  all  of  that  three  million  dollars'  worth  of  property 
would  be  forfeited  except  its  rolling  stock  ?  A.  That  is  the  way  I 
understand  this  bill. 

Q.  In  your  judgment,  as  a  reasonable  man,  is  that  a  reasonable 
law?    A.  No;  I  should  call  it  pretty  rough. 

Q.  Is  there  a  bonded  indebtedness  upon  your  road?     A.  Yes,  sir. 

Q.  How  much?     A.  Four  and  a  half  millions. 

Q.  Have  those  creditors  any  control  over  the  management  of  the 
railroad?    A.  Not  at  all. 

Q.  What  do  you  say  is  the  value  of  the  rolling  stock?  A.  In  Cal- 
ifornia and  Nevada  both,  $200,000. 

Q.  And  this  station  agent  may  do  this  act,  which  violates  the  law, 
and  all  the  property  except  the  rolling  stock  would  be  forfeited. 
What  would  become  of  all  these  bonds — the  bonded  indebtedness? 
A.  It  would  be  worthless. 

Q.  Where  are  those  bonds  held  ?  A.  In  New  York  and  San  Fran- 
cisco. 

Q.  What  are  the  bonds  worth  in  the  market?  A.  Between  three 
millions  and  three  millions  and  a  half. 

Q.  What  would  all  those  bonds  be  worth  if  the  law  provided  that 
any  agent  of  the  company  could  forfeit  all  of  this  property  except 
the  rolling  stock,  to  the  State,  by  simply  forwarding  a  car  of  freight 
out  of  its  order?     A.  Would  not  be  worth  a  dollar. 

Q.  Then  the  effect  of  this  bill  would  be  to  place  in  the  hands  of 
any  agent  of  this  company  the  power  to  destroy  the  entire  value  of 
the  bonds,  which  are  now  worth  three  to  four  million  dollars?  A. 
That  would  seem  to  be  the  effect. 

Q.  Would  you  consider  that  an  objection  to  this  bill?  A.  A  very 
great  one. 

Q.  You  stated  that  the  value  of  the  road  was  about  three  millions 
of  dollars;  what  would  be  its  value  if  the  law  placed  the  power  in 
the  hands  of  an  agent  of  that  road  to  in  a  moment  perpetrate  an  act 
which  would  turn  over  all  that  property  to  the  State  except  its  roll- 
ing stock  ?    A.  It  would  be  worthless. 

Q.  Nonv,  look  as  this  next  section,  which  provides  that  a  printed 
schedule  must  be  exhibited  whenever  demanded.  Suppose  that  one 
of  your  agents  became  dissatisfied,  and  hostile  to  the  interests  of  the 
company,  and  refused  to  deliver,  when  requested,  that  printed  sched- 
ule, and  that  thereby  the  property  was  forfeited,  could  you  give  us 
an  estimate  of  what  the  damage  might  be  to  the  company  by  the 
simple  failure  to  show  a  book  when  asked  for?  A.  Be  a  loss  of  the 
whole  property. 

Q.  Something  like  three  millions  of  dollars?     A.  Yes. 

<  I.  Then,  under  this  law,  if  one  of  youivagents  should  simply  refuse 
to  show  a  book  when  asked,  tire  result  would  be  to  forfeit  three  mil- 
lions of  dollars?    A.  Yes,  sir. 

Q.  Would  you  consider  that  feature  a  possibility  under  this  bill  ? 
A.  Yes,  sir. 

Q.  Suppose  that  this  bill  were  passed,  by  which  an  employe  or 


53 

agent,  by  simply  refusing  to  show  a  book,  could  forfeit  the  entire 
property  and  could  render  entirely  valueless  the  bonded  indebted- 
ness or  other  indebtedness,  where  is  the  man  that  would,  under  such 
a  law,  furnish  capital  to  build  railroads  within  the  State  of  Califor- 
nia?    A.  I  don't  know. 

Q.  Could  you  find  him  in  the  State?  A:  I  don't  think  you  could 
find  him  anywhere  in  the  world. 

Q.  What  is  the  name  of  your  company?  A.  The  Carson  and  Col- 
orado. 

Q.  In  how  many  States  has  that  company  charters?  A.  Two; 
California  and  Nevada. 

Q.  Built  in  both?     A.  Yes,  sir. 

Q.  What  would  be  the  result  if  a  law  were  passed  which  provided 
that  if  any  road  received  a  charter  from  another  State  it  should  for- 
feit its  charter  in  this  State?    A.  It  would  be  very  bad. 

Q.  Do  you  consider  those  dangerous  features  of  this  bill?  A.  I 
should  say  so. 

Q.  What  do  you  think  of  the  provision  that  three  or  four  millions 
of  dollars'  worth  of  property  should  be  sacrificed  by  the  mere  act  of 
an  agent?  What  do  you  think  of  that,  as  a  business  proposition? 
A.  I  don't  think  it  would  be  a  very  good  one.  I  don't  think  any- 
body would.  I  think  that  in  speaking  about  this  road  I  have  been 
basing  it  as  three  hundred  miles  long.  This  Act,  of  course,  does  not 
apply  to  the  State  of  Nevada.  That  would  be  our  saving  clause. 
There  are  one  hundred  and  seven  miles  here. 

Q.  Have  you  ever  known  of  such  tilings  as  Conductors  knocking 
down  ?     A.  I  have  heard  of  it. 

Q.  Supposing  that  a  Conductor  on  your  road,  within  the  State  of 
California,  where  you  had  a  fixed  rate  of  charges,  had  charged  a 
jmssenger  two  cents  more  than  the  regular  fare,  and  that  you  spoke 
to  him  about  it;  that  he  would  either  have  to  stop  or  quit  the  road; 
who  would  own  the  road  then,  you  or  the  Conductor?  A.  The  Con- 
ductor. 

Q.  He  would  have  you  in  a  position,  where,  if  you  said  to  him, 
"  Either  quit  knocking  down  or  leave  the  road,"  to  bring  a  complaint 
before  the  Attorney-General  and  have  your  charter  forfeited?  A. 
This  bill  does  not  operate  in  that  way. 

Q.  Does  it  not?  It  says  that  if  one  man  is  charged  more  than 
another,  thereby  the  charter  is  forfeited.  What  do  you  think  of  these 
matters  as  a  business  proposition  ?  A.  I  think,  as  I  said  before,  that 
this  is  going  t'o  be  a  very  bad  business  for  the  railroads  in  this  State. 

Q.  Have  you  any  idea  of  the  amount  of  bonded  indebtedness  of 
the  Central  Pacific  Railroad  Company?    A.  No,  sir. 

Q.  Do  you  know  that  about  twenty-seven  millions  of  them  run  to 
the  Government  of  the  United  States?  A.  I  don't  know;  1  know 
very  little  about  it. 

Q.  What  would  any  railroad  bonds  be  worth  to  their  holders,  if 
there  were  a  law  that  a  Conductor,  or  a  station  agent,  might,  in  a 
moment,  do  an  act  which  forfeited  all  its  property  except  the  rolling 
stock  ?     A.  Be  very  bad. 

Q.  Could  you  sell  bonds  under  such  circumstances?    A.  I  think 


54 

if  the  parties  buying  understood  it,  it  would  be  very  difficult.  It 
would  seem  to  me  I  would  not  want  to  buy  the  bonds  of  any  road  or 
anything  else,  if  I  was  likely  to  lose  them — if  that  was  going  to  be 
the  effect  of  the  bill. 

Q.  This  bill  cuts  a  great  deal  deeper  than  you  thought  at  first 
glance?    A.  Yes,  sir;  an  examination  shows  that  it  cuts. 

Q.  The  railroad  business  is  necessarily  conducted  by  local  agents,, 
is  it  not?     A..  Yes,  sir. 

Senator  Spencer — Do  you  find  any  place  in  this  bill  where  itsays 
that  an  agent  of  a  railroad  company  refusing  to  give  you  a  book, 
thereby  forfeits  its  charter  (reading  section  seven)?  That  speaks  of 
this  in  its  corporate  capacity,  and  you  so  understand  it?  A.  I  under- 
stand that  if  any  of  these  people  do  these  things 

Q.  Do  you  understand  that  what  a  man  does  by  an  agent  he  is  just 
as  responsible  for  as  if  he  does  it  himself?     A.  Yes,  sir. 

Q.  Then,  he  must  be  authorized  to  do  it?    A.  It  does  not  necessa 
rily  follow. 

Q.  If  he  does  it  without  the  scope  of  his  agency,  it  does  not  follow 
that  his  principal  would  know  it ;  you  know  that  as  a  business  prop- 
osition ?     A.  It  may  be  as  a  legal  one  ;  I  dare  say  it  is  legally  correct. 

Q.  It  does  not  say  that  if  any  station  agent  refuses  to  perform  any 
of  these  acts,  he  will  forfeit  it?  A.  That  is  just  the  point  we  were 
discussing  this  afternoon.  Sometimes  we  run  all  of  our  cars  over 
the  road,  and  we  are  short  of  cars,  and  it  is  a  difficult  thing  to  move 
freight  in  any  manner;  at  other  times  we  have  a  surplus.  A  party 
might  feel  very  much  aggrieved  at  not  getting  his  freight  off,  but  on 
account  of  the  difficulties  that  the  company  had,  it  could  not  very 
well  be  avoided. 

Q.  You  agree  with  me,  that  all  men  should  be  treated  alike  with 
regard  to  dispatch,  speed,  price,  and  accommodations  furnished?  A. 
Yes,  sir. 

Q.  Should  not  all  men  be  charged  alike  in  regard  to  forwarding 
freights?  Say  a  man  brought  his  freight  to  you  for  shipment;  isn't 
he  entitled  to  the  first  privileges  on  that  route,  and  should  not  that 
be  shipped  first — I  mean  in  a  large  quantity?  A.  I  don't  know  but 
it  should  to  some  extent. 

Q.  Isn't  that  an  instance  of  the  rule  that  all  men  should  be  treated 
alike  with  reference  to  dispatch  and  speed,  etc.?  Suppose  that  you 
bring  a  suit  at  law  before  your  neighbor,  and  you  are  ready  for  trial ; 
wouldn't  you  think  it  a  great  hardship  if  your  neighbor  should  have 
your  suit  postponed  till  his  was  tried?     A.  True. 

Q.  Supposing  that  you  were  to  go  to  a  tailor  and  order  a  suit  of 
clothes;  don't  you  think  it  would  be  a  hardship  if  Senator  Sullivan 
could  come  after  you  and  get  his  clothes  made  first?    A.  Yes,  sir. 

Q.  Then,  if  there  was  to  be  a  classification  of  freight,  it  would  be 
but  an  assertion  of  the  general  rule?    A.  Yes,  sir. 

Q.  You  do  not  understand  that  this  bill  is  to  fix  any  rate  of  freights? 
A.  Not  at  all. 

Senator  Johnson — I  will  ask  you  whether,  in  your  opinion,  all 
men  ought  to  be  charged  alike  in  reference  to  freight?    A.  I  do. 

Q.  And  with  reference  to  dispatch  and  speed?     A.  Yes,  sir. 


55 

Q.  And  with  reference  to  accommodations,  and  all  that?  A.  Yes, 
sir. 

Q.  Then,  if  the  meaning  of  this  bill  is  to  that  effect,  you  would 
agree  to  it?    A.  Yes,  sir;  if  that  is  the  meaning. 

Q.  Turning  over  to  page  two,  do  you  understand  that  portion  of 
that  section  to  refer  entirely  to  the  dispatch  and  forwarding  of  freight? 
A.  Yes,  sir;  I  believe  that  everything  is  to  be  left  as  it  was  on  the 
first  of  last  January,  in  that  respect. 

Q.  Suppose  that  a  given  body  of  freight  is  to  be  moved;  does  it 
make  any  difference  which  portion  of  it  moved  first?  A.  That  de- 
pends upon  circumstances;  it  depends  a  good  deal  upon  the  class  of 
freight. 

Q.  Suppose  you  had  at  a  warehouse  two  hundred  tons  of  wheat, 
and  you  go  to  the  agent  and  say,  "I  want  you  to  get  your  cars  right 
in  and  take  that  away;  I  want  you  to  arrange  to  put  the  cars  right 
on,"  and  you  make  the  special  arrangements  to  bring  the  cars  up, 
and  that  then  there  was  another  man  came  in  with  a  hundred  tons 
of  freight  which  he  was  anxious  should  also  go  right  away?  A.  There 
might  be  some  bother  in  getting  the  cars  there,  or  something  might 
occur;  that  might  be  one  difficulty.  If  we  had  to  take  all  of  the  first 
man's  first,  that  would  be  rather  bad  for  the  second  one,  you  know. 


Statement  of  Wm.  Johnston. 

Senator  Sullivan — Please  look  at  that  bill,  and  say  what  you 
think  its  effect  would  be  upon  the  consignors  of  the  State,  and  the 
people  who  are  engaged  in  transporting  goods  over  railways,  as  to 
whether  it  would  be  favorable  or  unfavorable?  Answer.  That  part 
of  it  that  refers  to  discriminations  would,  in  my  opinion,  be  favora- 
ble to  shippers. 

Q.  Would  it  be  unfavorable  to  railroads?  A.  I  do  not  think  that 
it  could  be.     I  am  no  railroad  man;  I  never  have  run  a  railroad. 

Q.  Would  you  say  that  this  is  a  bill  which  was  equitable  between 
man  and  man?     A.  Yes,  sir. 

Senator  Cross— Where  do  you  live?    A.  At  Richland. 

Q.  That  is  a  wheat  producing  place?    A.  Yes,  sir. 

Q.  Has  there  been  any  complaint  in  your  neighborhood  that  the 
railroad  company  do  not  forward  freight  in  the  order  in  which  it  is 
received?     A.  Not  that  I  know  of. 

Q.  Do-  you  know  of  any  person  in  that  community  ever  having 
been  charged  more  than  any  other  man  for  the  same  services  by  the 
railroad?  A.  Richland  is  not  a  shipping  point  by  rail;  everything 
is  shipped  by  water. 

Q.  Do  you  know  of  any  cause  of  complaint  by  the  agriculturists  of 
the  State  that  freight  offered  for  shipment  was  not  shipped  in  its 
order?    A.  Not  of  my  own  knowledge. 

Q.  Do  you  know  of  any  case  where  one  man  has  been  charged,  for 
shipping  his  products,  more  than  another,  for  the  same  class  of  goods 
or  produce  by  rail?     A.  Not  of  my  own  knowledge. 


56 

Q.  Fromjany  source  of  information  that  you  would  consider  reli- 
able? A.  1  don't  know  that  reports  that  a  man  gets  on  the  streets 
or  from  newspaper  articles  are  reliable  things  to  bring  before  a  com- 
mittee of  this  kind. 

Q.  Have  you  any  information  on  that  subject  that  you  would  con- 
sider thoroughly  reliable;  if  so,  we  would  be  glad  to  have  it?  A. 
Well,  from  persons  who  are  shipping,  I  understand  there  is  a  special 
contract  system  adopted  by  the  railroad  company  by  which  the  par- 
ties who  sign  the  contract  can  ship  for  less  than  those  who  do  not. 

Q.  Do  you  know  whether  those  relate  to  agricultural  products,  or 
whether  they  relate  simply  to  merchandise?    A.  I  do  not  know. 

Q.  Do  you  know  whether  or  not  the  result  of  these  contracts  is 
that  freight  is  delivered  at  Stockton,  San  Jose,  Marysville,  Los  Ange- 
les, and  Sacramento,  at  the  same  prices  that  they  are  received  in  San 
Francisco?  A.  I  never  heard  Marysville  included  in  the  list;  the 
others,  I  understand,  have  the  same  price. 

Q.  If  the  result  of  the  system  was  that  freights  were  received  at 
the  same  prices  at  these  points  that  they  are  in  San  Francisco,  do 
you  think  it  would  be  favorable  to  the  mercantile  communities  in 
those  towns?     A.  Yes,  sir. 

Q.  Did  you  hear  the  testimony  of  Mr.  Harrison?    A.  Yes,  sir. 

Q.  Do  you  agree  with  Mr.  Harrison  in  his  views  that  all  the  whole- 
sale'trade  should  be  done  in  San  Francisco?     A.  I  do  not. 

Q.  Do  you  think  that  there  would  be  any  impropriety  in  doing  a 
wholesale  business  in  those  places?    A.  I  do  not. 

Q.  You  stated  that  as  far  as  the  subject  of  discrimination  was  con- 
cerned, you  thought  that  the  bill  was  good  ?    A.  Yes,  sir. 

Q.  What  do  you  say  of  the  balance  of  the  bill ;  is  it,  in  your  opin- 
ion, a  just  measure?     A.  I  approve  of  it. 

Q.  You  approve  of  all  the  balance  of  the  bill  except  sections  one 
and  two?  A.  I  don't  know  of  anything  in  the  bill,  as  far  as  my 
knowledge  goes  of  railroading,  that  would  be  detrimental  to  the 
railroad  company,  and  certainly  it  would  be  beneficial  to  the  parties 
who  reside  and  do  business  along  the  lines  of  the  road  now. 

Q.  You  have  examined  the  bill?  A.  I  have  examined  the  bill 
from  a  producer's  standpoint. 

Q.  How  in  regard  to  a  consumer's  standpoint?  A.  Also  in  regard 
to  a  consumer's  standpoint. 

Q.  And  you  think  that  the  bill  is  a  just  bill?  A.  The  exception 
that  I  want  to  make -is  from  a  railroad  standpoint.  Not  being  inter- 
ested in  or  acquainted  with  railroads,  I  don't  know  what  effect  it 
would  have  upon  them. 

Senator  Cross — Do  you  know  of  anything  amounting  to  an  incon- 
venience or  injury  by  the  company  not  furnishing  information  as  to 
the  rates  of  freights  and  fares?     A.  No,  sir. 

Senator  Sullivan — Do  you  know  anything  about  the  special  con- 
tracts made  by  the  merchants  of  San  Francisco  in  regard  to  carrying 
merchandise  over  the  Central  Pacific  Railroad?  A.  It  is  a  matter 
that  I  do  not  know  anything  about. 

Q.  Have  you  ever  seen  one  of  these  special  contracts  of  the  Cen- 
tral Pacific  Railroad  Company?    A.  Yes,  sir. 


57 

Q,.  Do  you  know,  as  a  matter  of  fact,  that  this  special  contract 
binds  a  shipper  to  send  all  his  goods  by  rail?     A.  Yes,  sir. 

Q.  You  are  a  producer  and  a  man  who  understands  the  benefits 
accruing  to  the  State  of  California  by  this  discrimination  being  done 
away  with.  What  I  desire  from  you  is  your  opinion  as  to  whether 
this  special  contract  system  is  a  good  or  a  bad  thing  for  the  State? 
A.  I  think  it  not  good  for  the  State. 

Q.  Do  you  think  that  a  merchant,  or  a  producer  like  yourself, 
should  desire  to  ship  by  water — say  wheat  or  cereals  of  any  kind — 
that  it  would  be  more  beneficial  to  the  State  at  large  that  he  should 
be  compelled  to  ship  all  of  his  grain  or  productions  by  rail?  A.  I 
think  that  a  person  ought  to  be  allowed  to  ship  by  whatever  route  he 
received  the  most  benefit. 

Senator  Cross — Do  you  know  whether  those  special  contracts 
relate  to  outgoing  commerce,  or  whether  it  relates  simply  to  freights 
coming  into  the  State?  A.  The  contracts  that  I  am  acquainted  with, 
or  know  anything  about,  are  contracts  relating  to  incoming  freights. 

Q.  Contracts  that  in  no  manner  affect  the  productions  of  Cali- 
fornia?    A.  The  contracts  that  I  know  anything  about  do  not. 

Q.  Have  you  ever  known  of  any  complaint,  or  cause  of  complaint, 
that  any  railroad  company  did  not  keep  in  a  state  of  complete  effi- 
ciency its  track  and  other  structures?     A.  No,  sir. 

Q.  Have  you  ever  known  of  any  cause  of  complaint  from  the  fact 
that  any  railroad  company  in  this  State  hold  charters  from  any  other 
State?  A.  I  want  to  modify  that  answer  with  regard  to  the  Santa 
Monica  wharf;  I  believe  that  they  allowed  that  to  go  to  destruction. 

Q.  They  did  worse  than  that,  didn't  they  ?  A.  All  that  I  know  is 
what  I  read  and  saw.  It  has  gone  to  destruction ;  I  don't  know  what 
destroyed  it. 

Senator  Kellogg — They  took  up  the  track,  didn't  they?  A.  I 
don't  know. 

Senator  Sullivan — Do  you  know,  as  a  fact,  in  the  history  of  Cal- 
ifornia, whether  the  Central  Pacific  Railroad  Company,  or  the  South- 
ern Pacific  Railroad  Company,  or  any  other  railroad  corporation,  has 
ever  removed  its  track,  in  order  to  injure  any  towu  or  city  which  was 
disposed  to  hold  to  its  rights?  A.  There  has  been  a  railroad  removed 
in  this  county,  I  understand ;  I  don't  know  who  removed  it.  I 
understand  that  the  Central  Pacific  had  a  road  in  this  county,  lead- 
ing from  Freeport  to  Franklin,  that  has  been  abandoned  and 
removed,  to  the  detriment  of  Freeport,  in  this  county. 

Q.  You  know  that  as  a  fact?     A.  Yes,  sir;  I  know  that  as  a  fact, 

Senator  Cross — This  road  from  Freeport  to  Franklin;  do  you 
know  whether  that  would  pay  the  expenses  of  operating?  A.  I 
couldn't  say  that  I  know  anything  about  it,  I  was  not  interested  in 
the  road,  and  don't  know  what  the  returns  were.    I  believe  that  it  did. 

Q.  You  were  asked  a  question,  which  was  objected  to,  as  to  whether 
a  road  had  been  removed  from  where  it  was  intended  to  be  built? 
A.  I  had  reference  to  the  road  from  Freeport,  which  was  removed 
after  it  had  been  built. 

Q.  In  your  judgment,  should  any  railroad  company  be  compelled 


58 

to  maintain  a  branch  road  after  it  ceased  to  be  remunerative?     A. 
That  depends  upon  their  charter;  what  they  agreed  to  do. 

Senator  Kellogg — Do  you  not  know,  that  between  Marysville 
•  and  Knights  Landing,  they  were  compelled  to  remove  a  part  of  the 
road  on  account  of  the  road  being  under  water  so  much  that  they 
were  not  able  to  keep  it  open?     A.  I  only  know  that  by  hearsay. 

Q.  You  know  it  well  enough  as  a  matter  of  hearsay?  A.  I  believe 
it  to  be  so. 

Q.  Do  you  think  it  would  have  been  right  for  the  company  to  have 
been  compelled  to  keep  it  open  ?  A.  That  would  depend  again  upon 
what  the  company  agreed  to. 

Q.  Would  not  the  fact,  that  they  were  compelled  to  keep  up  an 
entire  new  line  of  road,  be  sufficient  cause  for  abandoning  that  part 
after  it  had  ceased  to  be  of  use  to  the  public?  A.  I  don't  know; 
they  should  keep  their  contracts. 

Senator  Kelley — Do  you  know  whether  or  not,  that  railroad, 
spoken  of  by  Senator  Kellogg,  was  a  subsidized  road  or  not?  A.  I 
do  not  know. 

Q.  Do  you  know  whether  they  received  any  bonds  from  the  coun-. 
ties  through  there?  A.  I  don't  know  what  the  conditions  of  the 
road  were. 

Senator  Vrooman — You  think  that  the  railroad  company  should 
stand  by  its  contracts?    A.  Yes,  sir. 

Q.  Like  everybody  else?     A.  Yes,  sir. 

Q.  Would  you  think  it  right  that  a  law  should  be  passed  imposing 
upon  the  company  conditions  other  than  those  in  its  charter?  A. 
No,  sir. 

Q.  I  understood  you  to  state  that  the  question  of  whether  a  com- 
pany should  have  a  right  to  remove  its  track  depended  upon  its 
charter?    A.  Yes,  sir. 

Q.  As  a  business  man  and  a  producer,  do'  you  think  it  would  be 
right  to  impose  upon  the  company  anything  in  addition  to  what  is 
found  in  its  charter,  as  to  its  right  to  remove  any  of  its  structures? 
A.  I  do  not  believe  in  retroactive  legislation. 

Senator  Vrooman — Do  you  think  that  any  rate  of  transportation 
is  special  which  is  open  to  every  man  in  the  community  in  like  cir- 
cumstances? A.  It  might  be  special,  and  yet  be  open  to  every  man 
in  the  community.     Any  rate  for  a  certain  kind  of  transportation. 

Q.  Suppose  that  you  had  a  special  rate,  or  a  rate  peculiarly  appli- 
cable to  a  certain  class  of  goods?  A.  We  pay  a  special  rate  on  some 
kinds  of  goods  that  we  ship  out  of  the  State. 

Q.  Suppose  that  there  is  a  rate  on  wheat  to  be  shipped  from  here 
to  San  Francisco,  and  that  that  rate  is  open  to  every  man  that  has 
wheat  to  ship.     Is  that  a  special  rate?    A.  It  is  special  as  to  wheat. 

Q.  And  that  would  be  so  as  to  every  class  of  goods?  A.  That  is 
my  understanding. 

Q.  Then  is  it  your  understanding  that  there  ought  to  be  a  uniform 
rate  on  all  kinds  of  goods  between  certain  points,  irrespective  of  the 
character  of  the  goods?     A.  No,  sir. 

Q.  Well,  it  is  true,  is  it  not,  that  in  the  transportation  business  the 
rates  on  goods  are  classified  ?     A.  Yes,  sir. 


59 

Q,  And  there  is  a  rate  for  each  class?     A.  Yes,  sir. 

Q.  Would  you  call  that  a  special  rate?     A.  Only  as  to  the  class. 

Q.  Do  you  think  that  those  rates  should  be  prohibited  ?     A.  No,  sir. 

Q.  Do  you  think*that  a  contract  that  every  man  in  the  community 
has  the  privilege  of  signing,  is  a  special  contract  ?     A.  I  do. 

Q.  Why?  A.  Because  it  is  not  open  to  all  shippers  who  do  not 
sign  it. 

Q,.  It  is  open  to  all  shippers  who  desire  to  sign  it?  A.  Then  it  is 
special. 

Q.  That  is  your  idea  of  a  special  contract?     A.  Yes,  sir. 

Q.  Supposing  that  it  should  appear'  in  evidence  that  if  the 
special  contracts  were  not  in  force  it  would  result  in  an  increased 
rate  of  transportation,  and  in  preventing  these  interior  towns  from 
being  distributing  points,  what  effect  do  you  think  it  would  have 
upon  the  business  interests  of  the  State?  A.  I  think  that  anything 
that  would  prohibit  the  interior  towns  from  being  points  of  distri- 
bution would  be  detrimental. 

Q.  Do  you  not  think  that  any  system  of  transportation  which  opens 
innumerable  distributing  points,  instead  of  being  all  at  one  point  or 
place,  is  in  the  interest  of  both  the  producer  and  consumer?  A.  I 
do. 

Senator  Sullivan — Does  not  the  special  contract  system  discrim- 
inate against  the  shipping  interests  of  our  State?  A.  Yes,  sir;  I 
think  it  does. 

Q.  Does  it  not,  in  other  words,  discriminate  against  another  mer- 
chant who  desires  to  send  his  goods  by  sea?  A.  I  think  that  Senator 
Vrooman  misunderstood  me;  I  did  not  know  that  there  was  any 
difference  between  San  Francisco  and  the  other  points  as  to  con- 
tracts. 

Q.  You  do  not  know  what  the  contracts  in  San  Francisco  are?  A. 
If  they  are  different,  I  do  not  know.     If  they  are  alike,  I  do  know. 

Q.  You  do  know  what  the  special  contracts  are  in  San  Francisco, 
do  you  not?  A.  As  I  stated,  there  might  be  a  difference  between  the 
contracts  signed  in  San  Francisco  and  the  other  places.  If  there  is, 
I  don't  know  of  any  difference.  I  know  the  contract  system  of  Sac- 
ramento. 

Q,  Is  it  similar  to  that  of  San  Francisco  ?     A.  I  do  not  know. 

Q.  As  far  as  you  know  about  the  contracts  at  Sacramento  ;  do  they 
not  compel  everv  man  who  signs  them  to  send  all  his  goods  by  rail? 
A.  They  do. 

Q.  Do  they  not  compel  every  man  who  signs  them  to  avoid  having 
any  business  dealings  with  a  man  who  ships  his  goods  by  water?  A. 
Yes,  sir. 

Q,  Is  it  not  a  fact  that  any  injury  done  to  the  shipping  interests  of 
San  Francisco,  either  directly  or  indirectly,  by  special  contracts,  or 
by  any  other  system  devised  by  the  railroad  managers,  is  an  injury 
to  the  State  at  large,  and  that  includes  not  only  San  Francisco,  but 
Sacramento,  Marysville,  Los  Angeles,  and  all  those  points  known  as 
terminal  points?     A.  So  far  as  it  affects  them. 

Q.  And  also  places  that  are  not  terminal  points,  such  as  Nevada, 
Placerville,  and  Quincy.     In  other  words,  any  injuries  done  to  the 


6U 

shipping  interests  of  San  Francisco  are  injuries  to  the  State  of  Cali- 
fornia?    A.  Yes,  sir. 

Q.  Is  it  not  a  fact  that  these  special  contracts  of  the  Central  Pacific 
Railroad  do  injure  the  shipping  interests  of  San  Francisco?  A.  I 
think  they  do. 

Q,  And  that  is  as  well  to  the  State  at  large?  A.  To  the  State  at 
large,  I  think  they  do. 

Q.  You  live  at  San  Francisco?    A.  Yes,  sir. 

Senator  Whitney — AVhat  facts  do  you  know  to  exist  growing  out 
of  the  special  contract  system  which  operates  injuriously  to  the 
State?  A.  I  know  of  a  firm  in  San  Francisco  that  is  doing  business 
here  and  selling  a  certain  class  of  goods,  and  the  business  depre- 
ciated and  almost  ceased  because  they  did  not  sign  a  contract,  and 
they  were  obliged  to  sign  it  in  order  to  continue  their  business,  so 
that  they  could  ship  their  goods  from  the  East  and  compete  with 
others  who  had  the  benefit  of  the  special  contract  system. 

Q.  They  were  successful  after  they  signed  the  contract?  A.  Yes, 
sir. 

Q.  Do  you  know  whether  they  suffered  any  disadvantage  after 
signing  the  contract  ?    A.  Yes,  sir. 

Q.  In  what  particular?  A.  They  were  prohibited  from  shipping 
the  article  of  wire,  in  which  they  were  dealing  largely,  by  water,  and 
they  were  obliged  to  get  it  by  rail,  and  they  could  have  shipped  it 
cheaper  by  water. 

Q.  Did  that  have  the  effect  of  injuring  their  business?  A.  The 
effect  of  lessening  their  profits. 

Q.  The  railroad  company  can  afford  to  do  business  at  a  less  figure 
if  they  have  a  larger  volume  of  business,  can  they  not?  A.  Yes, 
sir. 

Q.  Is  not  the  tendency  of  the  special  contract  system  to  increase 
the  volume  of  the  railroad  business?     A.  Yes,  sir. 

Q.  On  that  account  does  it  not  enable  them  to  contract  business  at 
a  much  less  figure  than  the}'  would  be  able  to  do  without  the  special 
contract  system?    A.  I  should  think  it  would. 

Q.  To  that  extent,  then,  would  it  not  operate  in  favor  of  the  con- 
sumer?    A.  No,  sir. 

Q.  Why  not?    A.  Because  they  do  not  do  it. 

Q.  Because  they  do  not  decrease  the  freight  correspondingly  ?  A. 
No,  sir. 

Senator  Sullivan — Is  it  not  a  fact  that  the  Central  Pacific  Rail- 
road Company  desires  to  drive  off  competition  by  water,  and  for  that 
purpose  may  lessen  its  rates  of  freight  and  passenger  fare  (to  drive 
off  the  water  craft  from  places  like  Sacramento  and  San  Joaquin) 
for  the  time  being?     A.  I  don't  think  I  can  answer  that  question. 

Q.  The  point  I  desire  to  make  is  this:  that  after  having  lowered 
the  rates  and  driven  off  the  water  craft,  they  will  then  raise  the  rates? 
A.  They  cannot  do  that  now;  it  is  prohibited  by  the  Constitution. 

Q.  I  understand;  but  within  the  limits  of  the  Constitution?  A. 
They  can't  raise  it  at  all.     It  is  unconstitutional. 

Q.  Do  you  not  think  it  would  be  better  if  the  railroad  and  the 
water  craft  were  allowed  to  compete,  one  with  the  other?     A.  I  do. 


61 

Q.  In  that  way  would  not  the  producer  and  the  consumer  reap  a 
larger  profit  than  they  do  now?    A.  Yes.,  sir. 

Q.  Do  you  know,  as  a  matter  of  fact,  in  regard  to  wheat  being 
shipped  from  stations  along  the  line  of  the  Sacramento  River,  that 
where  the  sloops  and  the  water  craft  were  driven  away,  the  railroad 
company  discriminates  injuriously  against  those  men  who  patronize 
water  craft?     A.  I  only  know  by  hearsay. 

Senator  Spencer — I  understand  that  you  have  read  this  bill? 
A.  Yes,  sir. 

Q.  Do  you  see  anything  in  the  bill  that  is  inimical  to  the  interests 
of  the  producer?    A.  No,  sir. 

Q.  You  do  not  pretend  to  pass  upon  the  legal  aspects  of  this  bill 
at  all?     A.  No,  sir. 

Q.  Therefore,  in  answering  some  of  these  hypothetical  questions, 
you  did  so  with  no  reference  to  your  knowledge  of  law  ?     A.  Yes,  sir. 

Q.  Let  me  ask  you  whether,  as  a  business  man,  you  believe  that 
the  mercantile  interests  of  this  State,  as  well  as  the  farming  interests, 
would  be  better  subserved  by  the  transportation  companies  serving 
all  the  people  alike,  irrespective  of  special  contracts  or  any  contracts 
excepting  a  general  and  uniform  rate  for  transporting  freight  at  a 
reasonable  price  for  all  persons?    A.  I  do. 

Q.  You  think  that  is  the  proper  system,  do  you  not?     A.  Yes,  sir. 

Q.  You  do  not  think  that  any  contract  should  be  entered  into  by 
a  transportation  company  with  any  person  where  they  imposed  any 
limitations  upon  him  or  any  penalties  as  to  who  he  should  deal  with, 
or  how  he  should  transport  any  goods  or  class  of  goods  that  he  trans- 
ported with  them,  do  you?  A.  I  presume  you  do  not  mean  by  a 
special  rate  that  there  should  be  th«  same  rates  for  a  special  carload 
that  there  was  for  a  small  quantity,  do  you? 

Q.  No;  I  do  not  mean  that.  A.  Then  I  will  answer  your  question 
in  the  affirmative. 

Q.  How  long  have  you  lived  in  this  State?    A.  Thirty  years. 

Q.  What  is  your  business?     A.  Agriculture. 

Q.  What  class  of  goods  do  you  generally  ship?  A.  Grain,  fruit, 
poultry,  and  stock. 

Q.  You  have  a  personal  experience,  outside  of  your  general  read- 
ing and  knowledge  of  these  subjects,  in  shipping  grain,  stock,  and 
agricultural  implements?  A.  Yes,  sir;  but  not  by  rail.  Very  little 
by  water.    I  ship  some  by  rail.    My  principal  shipping  is  by  the  river. 

Q.  Supposing  that  agricultural  implements  (say  wire),  or  any  arti- 
cle that  can  bo  shipped  by  water,  can  be  shipped  for  ten  dollars  a  ton 
and  landed  in  San  Francisco,  and  thereafter  be  shipped  to  the  inte- 
rior points  in  the  State,  while  it  would  cost  thirty  or  forty  dollars  a 
ton  to  ship  them  by  rail,  would  that  be  discriminating  against  the 
interior  towns?  A.  That  would  depend  upon  the  freight  from  San 
Francisco  to  the  distributing  points.  It  certainly  would  not  be  dis- 
criminating against  Sacramento. 

Q.  Then  you  do  not  mean  to  be  understood  that  if  freight  was  not 
distributed  at  points  through  the  State  different  from  San  Francisco 
(to  Stockton,  Marysville,  Los  Angeles,  and  other  distributing  points), 


62 

that  that  would  be  discrimination  against  those  interior  towns,  do 
you  V    A.  No,  sir. 

Q.  Then  you  think  that  that  mode  of  transportation,  assuming 
that  there  would  be  that  rate  of  difference,  would  not  be  discrimi- 
nating against  the  interior  points?  A.  I  think  that  that  rate  would  be 
the  best  which  would  distribute  the  goods  at  the  points  where  they 
were  consumed  at  the  least  rate  to  the  consumer. 

Q.  If  the}'  could  be  shipped  cheaper  round  by  wa«ter  to  that  place, 
that  is  the  whole  question  in  a  nut  shell  ?    A.  Yes,  sir. 

Q.  Do  you  not  think  that  the  special  contract  system  discriminates 
against  shipping  freight  by  water?  A.  It  does  if  it  prohibits  the 
contractors  from  shipping. 

Q.  If  a  man  has  a  general  contract  that  prevents  him  from  ship- 
ping by  water,  it  has  a  tendency  to  drive  ships  from  the  sea,  does  it 
not?     A.  Yes,  sir. 

Q.  Do  you  know  anything  about  any  rebates  that  have  been  prac- 
ticed by  the  railroad  companies  in  this  State,  from  conversations 
with  the  merchants  who  were  reliable,  as  to  Avhether  or  not  they 
paid  a  certain  amount  in  advance  of  the  rate,  and  then  kept  it  for  a 
certain  length  of  time,  and  then  paid  it  back  ?  A.  I  have  heard  of 
such  things. 

Q.  Do  you  believe,  as  a  business  man,  that  that  can  be  justified  by 
any  business  principle,  assuming  that  freight  was  $10  a  ton,  and  they 
charged  you  $25,  and  in  six  months  thereafter  they  gave  you  back 
$15,  claiming  that  the  actual  freight  is  $15?  A.  There  might  be 
some  discrimination  where  a  man  shipped  a  large  quantity,  and  for 
instance  a  whole  train  of  cars;  they  could  afford  to  do  it  cheaper  per 
car  than  if  shipped  by  a  single  carload. 

Q.  I  don't  think  you  understand  me?    A.  I  think  I  do. 

Q.  If  you  do  I  am  perfectly  satisfied.  Supposing  I  am  a  shipper, 
and  you  come  to  me  to  ship  some  freight,  and  ask  how  much  a  ton 
it  will  cost  to  ship  freight  to  San  Francisco,  and  I  answer  that  it 
would  cost  $10  per  ton,  and  you  shipped,  and  I  charged  you  (I  will 
say  for  purposes  of  illustration)  $30  for  three  tons,  and  that  wheu  you 
came  to  pay  that  freight  they  charged  you  $100;  that  after  six  months 
had  passed  they  come  to  you  and, notified  you  that  you  could  have 
$70  rebate.  Do  you  think  that  a  principle  upon  which  such  a 
thing  could  exist  would  be  justified  upon  any  business  principle? 
A.  Not  that  I  know  of. 

Q.  Is  that  what  you  understand  to  be  rebates?    A.  No,  sir. 

Q.  What  is  your  understanding  of  it?  A.  What  I  understand  by 
rebate,  is,  where  an  individual  was  shipping  at  the  regular  rates  and 
paying  at  the  regular  full  rate,  and  that  at  some  subsequent  time  he 
gets  a  rebate  from  the  regular  rate. 

Q.  Then  they  give  him  that  back  as  a  mere  gratuity?  A.  That  is 
the  way  that  I  understand  it. 

Q.  Upon  what  business  principle  is  that  justified?  A.  No  prin- 
ciple of  business. 

Q.  The  actual  freight  is  the  amount  actually  and  legitimately 
charged  ?    A.  Yes,  sir. 

Q.  Th/it  giving  back  is  an  excess  of  the  charge,  is  it  not?  A.  Yes, 
sir. 


63 

Q.  Did  you  ever  know  of  a  railroad  company  to  be  actuated  by 
motives  of  generosity  in  making  a  man  a  present  of  that  kind? 
A.  I  never  bad  any  experience  of  that  kind. 

Q.  You  do  not  know  of  any  legislation  that  has  ever  demanded 
any  such  thing?     A.  No,  sir. 

Senator  Taylor — Did  you  ever  know  of  any  case  such  as  the  Sena- 
tor speaks  of,  where  a  railroad  company  agreed  to  carry  freight  for  ten 
dollars  a  ton,  or  any  other  amount  in  excess  of  the  regular  rate,  and 
then  returned  it  after  keeping  it  three  months?     A.  No,  sir. 

Q.  Did  you  ever  hear  of  any  such  thing  from  any  reliable  source? 
A.  No,  sir.     I  understood  rebate  to  be  from  the  regular  rate. 

Senator  Sullivan — I  ask  you  whether  you  understand  rebate  to 
be,  where  an  agreement  was  made  by  special  contract  to  ship  goods 
say  from  St.  Louis,  and  the  amount  of  the  expense  bill  was  say  $400. 
That  is,  paid  by  the  consignee  to  the  agent  in  Sacramento.  He  cana 
not  get  the  goods  until  that  is  paid.  Then,  after  about  six  months, 
the  railroad  returns  to  him,  say,  $200.  That  is  what  you  understand 
by  rebate?    A.  Yes,  sir. 

Q.  The  expense  bill  calls  for  $400.    A.  That  is  the  regular  rate? 

Q.  Yes,  sir.  And  then,  after  a  period  of  six  months,  the  railroad 
company,  holding  his  money  in  the  meantime,  gives  him  $200  back. 
A.  That  is  what  I  understand  by  rebate. 

Senator  Cross — Do  you  know  whether  any  rebates  have  been 
practiced  in  the  State  of  late  years?  A.  Not  since  the  special  con- 
tract system  has  gone  into  effect,  there  are  no  rebates.  That  is  my 
understanding. 


Statement  or  J.  P.  Webster. 

Mr.  Chairman  and  Gentlemen:  I  do  not  know  that  I  have  any- 
thing to  offer  of  sufficient  importance  to  occupy  your  time.  It  is  very 
well  known  that  there  is  a  good  deal  of  feeling  in  this  State,  and  in 
the  country,  and  I  understand  your  purpose  here,  in  extra  session,  is 
to  do  justice  between  the  parties  and  the  people.  And  this  cer- 
tainly would  be  judicious.  It  certainly  is  very  much  against  the 
State,  and  against  the  railroad  companies,  and  other  corporations, 
that  this  state  of  feeling  should  exist,  and  if  the  railroad  men  have 
an  idea  of  advancing  the  material  interests  of  the  corporations,  or  of 
themselves,  I  should  say  you  are  here  to-day  to  reasonably  satisfy  the 
demands  against  the  railroad.  Our  people,  as  you  are  probably 
aware,  are  a  generous  people,  and  an  intelligent  people;  there  are 
none  more  so  in  the  world.  There  are  none  who  would  require, 
or  be  disposed  to  do  injustice  to  any  man.  Certainly  there  is  a 
feeling,  and  some  reason  for  it,  existing  against  the  railroad 
companies,  and  especially  against  their  discriminations  and 
failure  to  pay  their  taxes,  and  that  has  been  growing  two  or  three 
years;  and  although  the  railroad  companies  may  prevent  operations 
here,  I  think  that  it  would  be  injurious  to  the  interests  of  the 
railroad  companies  in  this  case,  because,  even  though  this  Leg- 
islature will  be  forced  in  this  controversy  to  yield  the  point,  it  can 


64 

never  be  settled  until  a  fair  disposition  of  the  question  be  had.  I 
understand  very  well,  that  in  a  great  many  instances,  capital  has 
demanded,  and  is  making  efforts  continually  now,  to  secure  itself 
against  the  public,  and  I  think  the  history  of  the  past  demonstrates 
my  putting  it  in  that  light.  The  best  interests  certainly  of  all  the 
parties  concerned  is  reasonable  legislation ;  that  its  reasonable 
demands  be  satisfied,  and  the  people  brought  into  harmony  with  the 
railroad  companies  and  with  the  railroad  industries  in  the  State. 
Relative  to  this  Barry  bill,  I  have  examined  it  somewhat,  of  course, 
not  particularly,  but  to  some  extent.  In  some  of  its  details  it  may 
be  defective,  but  I  think  the  principle  involved  is  correct. 

Senator  Sullivan — Have  you  read  this  Barry  bill?  Answer — 
Yes,  sir. 

Q.  You  understand  the  aim  and  purport  of  the  bill,  I  believe,  to 
prevent  discriminations  and  abuses  by  railroad  corporations?  A. 
Yes,  sir. 

Q.  The  principal  point  in  this  bill,  as  I  understand  it,  is  to  prevent 
discrimination.  Now,  in  regard  to  the  question  of  special  contracts, 
have  you  any  knowledge  of  what  these  special  contracts  are,  between 
the  Central  Pacific  Railroad  and  consignees  and  consignors  of  freight? 
A.  I  believe  I  have  seen  some  of  those  publications  in  the  newspa- 
pers which  I  have  read  on  the  subject. 

Q.  What  is  your  business?  A.  Horticulture,  and  agriculture  to 
some  extent,  and  running  a  paper. 

Q.  How  many  years  have  you  lived  in  the  State  of  California? 
A.  Thirty  years. 

Q.  During  that  time  have  you  been  identified  with  agricultural 
matters  in  this  State?  A.  I  have,  to  some  extent.  In  regard  to  the 
question  of  freights  and  fares;  I  have  not  very  extensive  acquaint- 
ance.   Living  so  near  San  Francisco  our  freights  have  been  nominal. 

Q.  Where?     A.  Just  across  the  bay. 

Q.  Have  you  any  knowledge  of  this  present  contract  system  that 
has  been  so  frequently  spoken  of?  A.  As  I  stated  before,  from  what 
has  been  published  on  the  subject. 

Q.  Do  you  know  of  any  person  who  has  been  injured  by  the  action 
of  the  special  contract  system?  A.  I  have  heard  of  a  gentleman  of 
San  Francisco  who  has  been  very  largely  engaged  in  shipping.  Some-  • 
thing  like  a  year  ago  he  stated  that  he  had  stood  out  against  the 
special  contract  system  for  two  or  three  years,  and  that  he  was  unable 
to  do  it  longer;  that  he  had  been  previously  shipping  heavier  goods 
around  Cape  Horn,  and  to  get  those  goods  across  the  continent  he 
had  to  pay  heavier  rates.  They  raised  the  rates  on  the  outside  ship- 
pers to  such  an  extent  that,  he  was  compelled  to  accept  the  contract 
in  order  to  save  his  business  from  ruin. 

Q.  You  have  studied  over  this  matter  a  great  deal — thought  over 
it,  and  heard  the  opinions  of  varied  people  in  California?  A.  Yes, 
sir. 

Q.  Now,  I  ask  you,  from  the  knowledge  thus  acquired,  what  is 
your  opinion  in  regard  to  the  effect  of  this  special  contract  system,  as 
practiced  by  the  Central  Pacific  Railroad  corporation,  on  the  ship- 
ping interests  of  the  State  of  California?     A.  Ruinous. 


65 

Q.  How,  and  in  what  manner  is  it  ruinous?     A.  In  this  way:  Of 

course  you  understand  that  certain  principles  as  stated  hereto-day, 
that  the  contracts  made  to  which  one  entering  into  agrees  to  ship  all 
freights  in  that  way,  and  that  he  is  prohibited  from  selling  any'goods 
or  dealing  with  any  merchant  who  does  not  ship  in  that  way.  The 
tendency  has  been  in  this  case  I  spoke  of,  to  bring  heavy  manufac- 
turing and  agricultural  implements  around  the  Horn,  and  in  a  great 
measure  the  shippers  of  such  goods  have  sent  them  by  special  con- 
tract, and  if  the  transportation  of  all  goods  for  the  State  comes  in 
this  way,  of  course  there  could  be  no  inducement  for  vessels  to  come 
to  this  coast.  That,  as  I  understand  it,  is  one  of  the  chief  objections 
to  the  special  contract  system. 

Q.  In  other  words,  you  say  that  it  virtually  cuts  off  our  vessels 
from  competition?  A.  So  far  as  the  signing  of  those  contracts  is 
concerned  it  has  a  tendency  to  break  up  competition. 

Q.  I  ask  you  now  if  the  entire  State  of  California,  including  the 
various  towns  of  Sacramento,  Los  Angeles,  Marysville,  or  any  other 
shipping  terminal  point,  even  Stockton,  Modesto,  Yisalia,  or  any  of 
these  towns,  are  not  interested  in  the  operation  of  this  special  con- 
tract system  ?     A.  I  take  it,  sir,  that  they  are  all  equally  interested. 

Q.  For  what  reason?  A.  Because  it  would  enable  any  shipper  of 
agricultural  implements  to  ship  around  Cape  Horn.  The  merchants 
here  are  dealing  very  heavily,  formerly  in  Stockton  and  those  other 
places,  and  now,  under  the  special  contract  system,  as  I  understand 
it,  they  have  no  discretion  in  the  matter  at  all.  They  are  compelled 
to  ship  all  their  goods  across  the  continent  by  the  railroads.  It  is 
policy  that  there  should  be  competition,  and  when  there  is  between 
several  carriers  they  will  regulate  the  rate. 

Q.  Do  you  know  if  there  is  any  chance,  considering  this  policy 
practiced  by  the  Central  Pacific  Railroad,  for  any  individual,  or 
private  corporations,  to  build  or  own  any  line  parallel  with  theirs? 
A.  There  is  only  one"  chance  that  I  see,  and  that  is,  to  have  more 
capital,  and  more  brains,  and  more  energy,  than  the  company  now  in 
operation. 

Q.  What  effect,  if  an}*,  would  the  special  contract  system — the 
system  of  discrimination — have,  in  regard  to  any  new  line  of  rail- 
road started  by  independent  capital  ?  A.  Well,  as  was  illustrated  in 
the  Northern  Pacific  Railroad,  or  as  was  in  the  paper,  the  manager 
of  that  road  agreed  first,  not  to  enter  into  the  special  contract  system, 
but  they  were  subsequently  forced  into  it,  which  would  indicate  they 
found  it  more  to  their  advantage  than  to  run  independently. 

Q.  You  would  imply  that  no  railroad  line  built  by  a  corporation, 
or  an  individual,  could  compete  with  the  railroad  company,  provided 
this  special  contract  system  is  enforced  ?  A.  It  appears  to  me  not. 
It  was  reported  in  San  Francisco  at  the  time  the  agent  was  the^e, 
that  the  merchants  of  San  Francisco  were  timid,  and  so  fear- 
ful that  the  Northern  Pacific  Railroad  Company  would  not  be  able 
to  carry  out  its  contract,  that  there  were  very  few,  or  none  at  all, 
that  would  guarantee  their  contract  to  the  Northern  Pacific  Railroad 
Company. 

Senator  McClure — Do  you  state  that  of  your  own  knowledge? 


66 

A.  I  got  it  from  the  merchants.  It  was  reported  so  in  the  papers, 
and  also  by  a  very  large  shipper  of  such  goods. 

Q.  Do  you  know  anything  about  the  special  contract  system  of 
your  own  knowledge?  A.  Nothing — only  what  I  say  has  been 
printed. 

Q.  What  you  read  and  heard?     A.  Yes,  sir. 

Q.  All  that  you  have  stated  is  based  on  what  you  have  read  and 
heard  ?    A.  Yes,  sir. 

Q.  It  is  not  predicated  upon  any  facts  of  your  own  knowledge  ? 
A.  Not  absolutely. 

Q.  Did  you  ever  run  or  operate  a  railroad  ?     A.  A  horse  railroad. 

Q.  A  steam  railroad,  for  the  purpose  of  carrying  freight  and  pas- 
sengers ?    A.  No,  sir. 

Q.  You  don't  pretend  to  know  anything  about  the  railroad  busi- 
ness?    A.  No,  sir. 

Q.  As  a  representative  man  of  the  agricultural  interests  of  this 
State,  do  you  not  think  and  believe  that  the  interests  of  the  farmers 
and  of  the  railroad  corporations  should  be  in  harmony  for  the  best 
interests  of  all  the  people  of  the  Pacific  Coast?  A.  There  is  no  doubt 
of  that. 

Q.  Do  you  not  believe  that  any  law  intended  to  cripple  the  rail- 
road company  would  be  detrimental  to  the  interests  of  them  as  well 
as  the  farmer?  A.  That  might  be  qualified.  It  would  depend 
upon  what  your  definition  of  that  term  is. 

Q.  You  understand  ;  my  question  is,  to  cripple ;  I  mean  any  unjust 
method?    A.  Oh!  any  unjust  method  ;  certainly. 

Q.  After  examining  the  bill,  do  you  think  if  the  bill  is  permitted 
to  pass,  that  it  is  a  just  and  fair  bill  for  the  corporations,  the  ship- 
pers, and  the  consumers,  without  amendment?  A.  If  that  is,  to  go 
in  that  shape  or  not  at  all,  I  should  say  that  it  was  beneficial  to  go ; 
but  it  might  be  amended  in  some  particulars,  possibly. 

Q.  Don't  you  think  it  could  be  improved  by  amendment  ?  A. 
Well,  I  don't  know;  I  am  not  well  enough  posted  to  determine  that 
point. 

Senator  Spencer — What  part  of  the  country  do  you  live  in?  A. 
Alameda  County. 

Q.  I  understood  you  that  you  have  lived  in  that  county  about 
thirty  years?     A.  Yes,  sir. 

Q.  Have  you  mingled  with  the  community  and  business  men, 
generally,  there?    A.  Yes,  sir;  quite  extensively,  I  think. 

Q.  During  the  time  of  your  residence  there,  have  you  had  oppor- 
tunities of  hearing  the  opinions  of  the  people  generally?  A.  Yes, 
sir  ;  in  a  general  way. 

Q.  State  whether  or  not  you  have  had  occasion  to  travel  around  in 
this  State,  and  in  different  portions  of  it?    A.  Yes,  sir. 

Q.  What  portions  of  this  State  have  you  been  through?  A.  I 
have  been  through  the  northern  portions,  and  northerly  to  the  end 
of  the  road,  and  also  to  Los  Angeles,  and  the  Town  of  San  Diego, 
and  traveled  extensively  shorter  distances  around  the  country. 

Q.  Do  you  say  that  you  are  connected  with  a  newspaper?  A.  Yes, 
sir. 


67 

Q.  What  paper  is  that?  A.  California  Patron;  the  official  organ 
of  the  State  Agricultural  Society. 

Q.  Are  you  a  member  of  the  State  Grange?  A.  Yes,  sir;  Secretary 
of  the  California  State  Grange. 

Q.  At  meetings  of  the  Grange  have  you  ever  heard  the  subject  of 
freights  and  fares  discussed  generally?     A.  Yes,  sir. 

Q.  Have  you  given  that  subject  any  special  attention,  with  refer- 
ence to  going  into  the  minutest  details  of  it?  A.  Possibly  not  the 
minutest  details;  no,  sir. 

Q.  You  have  not  tried  to  get  up  a  schedule  of  fares  and  freights  ? 
A.  No,  sir;  I  have  not  gone  to  that. 

Q.  Classified  into  ten  thousand  classes?     A.  No,  sir. 

Q.  Do  you  know  from  these  different  localities,  from  the  people  of 
this  State,  whether  any  general  complaint  as  to  the  mode  and  man- 
ner in  which  freights  are  transported  by  the  transportation  compa- 
nies of  this  State  exist,  including  the  Southern  Pacific  Railroad  and 
the  Central  Pacific  Railroad?  A.  I  know,  possibly,  more  about  fares 
than  freights.  I  have  more  direct  dealings  with  fares  than  freights, 
and  of  course,  in  a  general  way,  I  have  heard  complaints.  Whether 
I  could  state  specifically  any  particular  case  that  would  bear  directly 
upon  this  proposition 

Q,  Would  you  be  kind  enpugh  to  state  to  the  committee  in  what 
respect  discriminations  have  been  practiced  with  reference  to  local- 
ities or  persons?    A.  With  reference  to  persons,  very  considerable. 

Q.  You  think  that  has  been  practiced  with  reference  to  persons 
very  considerably?  A.  Yes,  sir,  it  has;  a  great  many  cases  might  be 
cited,  possibly. 

Q.  Senator  Kellogg  asked  you  if  any  cinch  measure  would  be  a 
beneficial  measure.  You  have  been  in  California  twenty  years?  A. 
Yes,  sir. 

Q.  Did  you  ever  know  a  railroad  company  to 'be  cinched  at  any 
time,  in  the  common  acceptation  of  the  term?  A.  No,  sir;  I  think 
the  cinch  has  always  been  on  the  other  side. 

Q.  If  they  are  cinched  too  tight  they  buck  it  off,  don't  they?  A. 
They  never  got  the  girth  tight  enough  to  cinch  them. 

Q.  You  do  not  understand  that  the  farmers,  or  the  producers,  or 
the  merchants  desire  any  cinch  measures,  or  any  unjust  measures? 
A.  No,  sir. 

Q.  I  understood  you  to  say,  as  a  business  man,  and  a  producer,  that 
if  this  measure,  as  it  is  now,  should  pass,  in  your  opinion  it  would  be 
better  than  no  measure  at  all?  A.  Altogether,  sir;  while  it  might 
be,  in  some  of  the  details,  amended  to  make  it  more  harmonious. 

Q.  In  speaking  of  the  different  sections  of  this  bill,  you  were  not 
speaking  with  reference  to  its  legal  aspects,  were  you?  A.  I  could 
not  speak  of  its  legal  effect. 

Q.  You  are  not  qualified  to  say  whether  they  are  constitutional  or 
unconstitutional?     A.  I  am  not  qualified  to  do  that. 

Q.  Nor  whether  it  contravenes  the  fourteenth  amendment?  A.  I 
never  have. 

Q.  Have  you  sent  any  freight  under  special  contract  yourself?  Can 
you  tell  me  what  is  the  general  opinion  among  the  men  with  whom 


68 

you  have  associated,  with  the  commercial  community,  and  business 
community,  including  the  farmers  and  producers,  as  to  the  policy  of 
entering  into  contracts  called  special  contracts,  and  whether  or  not 
you  believe  that  every  man  should  have  the  right,  whether  he  has  a 
contract  or  not,  to  ship  the  same  classes  of  freights  the  same  distance 
without  discrimination?     A.  I  certainly  think  so. 

Q.  Do  you  know  anything  about  what  is  called  rebate  money?  A. 
Very  little;  I  have  heard  of  some  very  apparent  cases,  but,  of  course, 
it  would  hardly  have  a  bearing  upon  this. 

Q.  Do  you  know  of  any  discrimination  against  places  practiced 
by  the  railroad  company?     A.  In  fares;  yes,  sir. 

Q.  State  them.  A.  There  is  one  illustration,  possibly  as  good  as 
any  would  be ;  that  is  the  fares  from  San  Francisco  to  Stockton,  which 
is  three  dollars,  and  from  Stockton  to  Sacramento  it  is  two  dollars, 
while  a  through  ticket  from  San  Francisco  to  Sacramento  is  only 
three  dollarsand  thirty  cents,  makinga  difference  between  Sacramento 
and  Stockton  of  thirty  cents,  when  the  distance  is  fifty  miles. 

Q.  Supposing  that  you  bought  a  ticket  from  San  Francisco  to 
Stockton,  and  then  the  next  morning  go  on  through  from  Stockton 
to  Sacramento,  what  is  the  difference  in  fare?  A.  I  bought  a  ticket 
from  Sacramento  to  San  Francisco,  about  a  year  ago,  for  four  dollars,, 
and  went  down  to  Elk  Grove,  twenty  miles  below  here.  There  I 
requested  the  conductor  to  give  me  a  stop-over  ticket;  he  said'that  I 
was  too  late,  that  he  had  not  the  time,  that  he  had  to  go  through  the 
cars  and  take  up  the  collections.  I  was  compelled  to  get  off  there; 
but  previous  to  that  the  conductor  had  come  along  and  taken  up  my 
ticket  and  had  given  me  a  blank  check,  nothing  on  it  except  some 
distances.  I  got  off  at  Elk  Grove.  The  next  day  I  got  on  the  train 
at  the  same  hour  and  presented  my  blank  check;  he  stated  that  it 
was  not  good  for  anything;  that  I  had  missed  the  train  for  which  I 
had  taken  a  ticket,  and  therefore  had  lost  about  three  dollars  and 
seyenty-five  cents;  and  I  paid  that  much  more  and  went  along, 
making  seven  dollars  and  seventy-five  cents  from  Sacramento  to  San 
Francisco. 

Q.  Do  you  know  of  any  discriminations  against  places  on  account 
of  any  positions  which  they  had  taken  on  the  railroad  questions? 
A.  I  don't  know  positively.  There  has  been  threats  of  that  kind, 
but  I  don't  know  of  their  having  been  carried  into  operation. 

Q.  How  about  Lathrop  and  Stockton ;  what  is  the  name  of  that 
road?    A.  I  think  it  is  operated  by  the  Southern  Pacific  Company. 

Q.  Do  you  know  anything  about  discrimination  being  practiced 
upon  that  road?  A.  I  never  had  any  experience,  and  of  course  could 
not  speak  positively.  Of  course  it  would  not  be  proper  for  me  to 
relate  anything  which  I  may  have  heard. 

Q.  Do  I  understand  you  to  state  that  the  effect  of  these  special 
contracts  is  to  discriminate  against  shipping  by  water?  A.  It  is  cer- 
tainly so. 

Q.  Do  you  not  think  that  any  discrimination  of  any  kind  that 
would  operate  against  the  shipping  interests  of  San  Francisco  would 
not  only  thereby  increase  the  price  of  goods  in  this  State,  but  would 
be  a  discrimination  against  the  interior  towns?     A.  I  take  it  that 


69 

anything  that  was  discrimination  against  San  Francisco  would  have 
its  effect  upon  all  parts  of  the  State. 

Q.  If  that  was  a  commercial  center,  and  goods  could  be  shipped 
there  by  water  for  twenty  dollars  a  ton,  whereas  it  cost  forty  dollars 
a  ton  to  deliver  them  by  rail  in  the  interior  towns  of  Stockton,  Los 
Angeles,  Marysville,  and  Sacramento,  they  could  make  that  much 
difference  by  having  them  shipped  by  water,  could  they  not?  A.  If 
that  is  a  correct  assumption. 

Q.  Do  you  know  whether,  wheu  goods  have  been  consigned  to  any 
place  in  this  State  (say  Lodi),  that  they  have  carried  the  car  past  the 
place,  and  on  to  Stockton,  or  to  Oakland,  and  then  shipped  it  back 
again,  and  charged  freight  for  the  additional  shipment  back?  A. 
TJnjy  have  a  through  rate,  and  the  railroad  company  claim  that  in 
order  to  get  a  through  rate  they  have  to  carry  the  goods  clear  through, 
and  that  is  cheaper  for  the  shipper. 

Q.  Do  you  know  whether  there  is  an  additional  charge  for  carry- 
ing that  back  over  the  same  route?  A.  I  never  had  any  positive 
experience  in  that  myself. 

Senator  McClure — I  understand  you  that  they  transport  freight 
for  one  person  for  less  than  they  do  for  another;  that  they  make  a 
discrimination  between  persons?  That  is  one  of  the  complaints? 
A.  I  believe  it  is. 

Q.  Do  you  understand  that  all  freight  of  every  kind  or  class  ought 
to  be  carried  at  the  same  rate?     A.  No,  sir. 

Q.  There  is  no  such  complaint  as  that?  You  could  not  carry  silks 
for  the  same  price  that  37ou  could  carry  iron?  The  general  com- 
plaint is  they  discriminate  between  persons — is  that  the  idea?  A.  It 
is  only  between  persons,  as  1  take  it,  and  not  as  to  classification  of 
freight? 

Q.  I  understood  you  that  they  did  discriminate  between  indi- 
viduals as  to  particular  classes  of  freight,  and  even  in  the  same 
class  between  two  individuals.  Of  course  that  is  wrong  and  ought 
to  be  remedied,  but  do  you  understand  that  there  is  a  general  desire 
that  the  railroad  should  be  compelled  to  fix  a  uniform  rate  of  freight 
with  reference  to  every  class  of  freight  and  put  it  all  into  one  class? 
A.  Not  into  one  class,  no.    To  reduce  the  classification. 

Senator,  Taylor — As  the  aim  of  this  committee  is  to  get  at  the 
views  of  the  people  general^  and  to  arrive  at  a  proper  conclusion, 
I  will  ask  you,  as  you  have  said  that  you  were  a  member  of  the  State 
Grange  and  had  relations  with  the  farmers  throughout  the  State, 
north  and  south,  and  therefore  were  in  a  position  to  give  us  the  gen- 
eral impression  of  the  agricultural  people  of  the  State,  as- to  whether 
or  not  there  exists  now  any  discrimination  in  the  freight  by  railroad 
or  not?     A.  I  think  that  that  impression  is  ver}'  general. 

Q.  That  those  discriminations  exist?     A.  Yes,  sir. 

Q.  You  have  stated  that,  in  your  opinion,  the  Barry  bill,  as  far  as 
if  goes,  would  be  better  than  nothing  at  all  ?     A.  Yes,  sir. 

0.   But  that  it  might  have  certain  amendments?     A.  Yes,  sir. 

Q.  Do  you  mean  by  that  that  some  of  the  sections  are  too  severe? 
A.  That  depends  upon  the  legal  construction  (reading  section  four). 
That  is  a  legal  question  that  1  do  not  understand. 


70 

Q.  Do  you  think  it  proper  that  in  a  case  of  this  character,  even 
where  there  is  discriminations,  whether  by  railroad  companies  or  by 
persons,  the  remedy  should  be  of  such  a  character  as  to  make  the 
punishment  of  them  severe?  A.  It  ought  to  be  severe,  but  the  ques- 
tion of  whether  it  ought  to  be  by  a  forfeiture  of  their  charter,  is  one 
that  ought  to  be  made  so  plain  that  there  could  be  no  quibbling 
about  it,  whatever  it  is.  And,  whether  receiving  a  charter  in  another 
State  should  forfeit  their  charter  in  this,  is  a  question  I  am  hardly 
able  to  cope  with. 

Senator.  Sullivan — Would  this  bill  be  good  for  anything  if  there 
was  not  a  penalty  fixed?     A.  I  think  not. 

Q.  It  is  absolutely  necessary  that  there  should  be  some  penalty  for 
the  violation  of  any  section  which  it  contains?    A.  I  think  so. 

Q.  In  answer  to  a  question  you  referred  to  some  track  that  had 
been  destroyed?  A.  That  was  abandoned  track.  That  point  was 
raised  here  this  morning.  Of  course  they  may  be  conditions,  and  it 
depends'a  good  deal  upon  the  charter  and  what  that  requires,  and  if 
there  is  anything  in  the  charter  of  the  railroad  company,  or  their 
obligation  to  the  State,  that  should  cause  them  to  maintain  the  road, 
if  they  have  that  understanding  when  they  take  their  charter,  then 
it  should  be  forfeited  if  they  abandon,  in  my  opinion. 

Q.  If  that  section  was  amended  so  as  to  meet  this  objection  of  yours, 
do  you  think  that  would  be  satisfactory?     A.  I  think  so. 

Q.  Is  it  not  the  fact  that  any  classification  causes  discrimination? 
A.  Yes,  sir. 

Q.  It  has  been  in  evidence  here,  and  has  been  admitted,  that  the 
railroad  company  charge  more  for  carrying  ore  worth  thirty  dollars 
a  ton  than  for  ore  worth  ten  dollars  a  ton.  What  is  your  opinion 
about  that  kind  of  classification?     A.  I  do  not  think  it  is  just. 

Q.  In  other  words,  you  do  not  think  that,  under  any  classification 
of  freights,  the  railroad  company  has  any  right  to  enter  into  the 
profits  of  the  purchaser  or  consumer?  A.  Not  into  the  profits,  no, 
sir;  but  they  have  possibly  a  right  to  enter  into  the  value  of  the  pro- 
ducts. For  instance,  in  the  transportation  of  bullion,  or  anything  of 
that  kind,  there  is  some  risk.  The  freight  should  be  raised  of  course 
on  articles  of  value  sufficient  to  cover  the  cost  of  insurance  and 
the  extra  expense  of  handling  such  goods. 

Q.  Do  you  think  they  should  charge  more  for  conveying  tea  than 
for  wheat,  for  instance?  A.  Yes,  sir;  because  there  has  to  be  more 
care  in  the  handling,  and  the  risk  is  greater.  There  should  be 
enough  additional  to  cover  the  additional  cost  of  handling  and  the 
cost  of  insurance. 

Q.  Well,  take  two  cars  of  wheat  and  two  cars  of  barley,  and  one 
brings  fifty  per  cent  less  than  the  other  in  the  market,  and  they  are 
classified  as  A  and  B.  Do  you  think  that  the  railroad  company 
should  charge  any  more  for  class  A  than  for  class  B?  A.  No,  sir; 
not  one  cent. 

Senator  Johnson — You  have  been  asked  the  opinion  of  the 
Grange.  Are  you  prepared  to  speak,  in  answer  to  that  question,  as 
to  the  opinion  of  the  Grange,  at  any  of  their  meetings,  upon  the  sub- 
ject of  discrimination  ?    A.  Yes,  sir.    At  the  last  meeting  of  the  State 


71 

Grange,  in  October,  there  was  a  series  of  resolutions  adopted  by  the 
Grange  (I  think  without  any  dissenting  voice,  as  far  as  I  remember), 
in  favor  of  fixing  rates  of  freights  and  fares,  and  in  calling  the  extra 
session  for  that  purpose.  I  think  the  resolutions  can  be  produced,  if 
necessary.     Mr.  Coulter  has  a  copy  of  them. 

Senator  Spencer — That  does  not  say  upon  the  subject  of  discrim- 
ination?    A.  It  refers  to  the  Constitution  of  the  State,  etc. 

Q.  I  will  ask  you,  then,  under  the  wording  of  that  Constitution, 
'section  twenty-one,  of  article  twelve,  of  it,  is  included?  A.  I  have 
not  examined  them. 

Q.  Do  you  recollect  this  provision  in  the  Constitution  of  the  State : 
"No  discrimination,"  etc.?  (reading  section  twenty-one,  of  article 
twelve).  I  will  ask  you  whether  or  not  in  your  opinion  a  law  that 
will  operate  alike  upon  all  persons  is  the  proper  law  to  be  passed  by 
special  legislation?  A.  I  think  it  should  be  the  province  of  every 
legislative  body  to  take  it  in  its  broadest  sense.  It  is  not  for  any 
class. 

Q.  Can  you  see  any  objection  to  page  one  of  the  Barry  bill,  where 
the  idea  intended  to  be  conveyed  is  this:  "that  all  persons  shall  be 
served  alike  without  discrimination?"  A.  I  do  not  see  how  there 
could  be  any. 

Q.  Following  the  provisions  of  the  Constitution,  which  are  man- 
datory and  prohibitory,  would  not  it  be  the  duty  of  the  Legislature, 
in  your  opinion,  to  carry  out  the  provisions  of  article  twelve  if  there 
is  no  other  provision  in  respect  to  discrimination?     A.  I  think  so. 

Q.  You  stated  that  all  persons  should  be  treated  alike  in  respect 
to  the  accommodations  as  regards  the  moving  of  freight.  Now,  will 
not  the  same  general  rule  hold  in  regard  to  the  dispatch  arid  forward- 
ing of  freight?  A.  The  only  point  there  is  that  certain  classes  of 
freight  are  perishable,  and  there  may  be  such  a  mass  of  freight  to 
move  that  a  limited  number  of  cars  could  not  transport  it,  and  thus 
the  perishable  freight  might  become  valueless. 

Q.  Suppose  that  the  provision  of  the  Barry  bill  was  this:  "a  pref- 
erence may  be  given  to  perishable  articles  and  to  fast  freight;"  would 
that  cover  your  idea?  A.  I  think  that  that  would  be  a  great  amend- 
ment. 

Q.  In  your  judgment  do  the  words  "  perishable  articles,"  include 
live  stock  ?  A.  That  is  a  legal  question,  but  it  occurs  to  me  to  say 
that  I  do  not  think  it  would  be  a  great  stretch  of  opinion  to  say  that 
it  would. 

Q.  That  would  be  your  opinion?  A.  Yes,  sir;  because  after  the 
shipper  has  his  stock  in  the  cars,  it  is  of  the  utmost  importance  that 
they  should  be  moved. 

Q.  I  understand  your  position  to  be  that  all  persons  should  be 
served  alike  with  respect  to  dispatch,  and  speed,  and  accommoda- 
tions, unless  it  was  impracticable?  A.  There  is  no  question  about 
,  that,  but  who  is  to  judge  of  the  impracticability  ?  There  is  the  point 
right  there  that  it  would  be  possible  to  cover. 

Q.  Do  you  not  think  that  the  penalty  ought  to  be  sufficiently  severe 
to  enforce  this  bill,  if  the  bill  is  right?     A.  Certainly. 

Q.  Is  there  any  objection  to  holding  a  corporation  liable  for  its 


72 

acts  any  more  than  a  natural  person?  A.  I  do  not  understand  that 
an  artificial  person  should  be  allowed  any  more  privileges  than  a 
natural  person: 

Q.  If  a  natural  person  is  an  agent,  and  he  commits  acts  without 
the  scope  of  his  authority,  your  opinion  is  that  the  natural  person 
ought  to  be  punished?     A.  He  is,  if  I  understand  it  right,  now. 

Q.  Is  it  not  your  opinion  that  the  same  rule  ought  to  be  applied  to 
corporations,  if  the  agent  acts  within  the  authority  of  the  corpora- 
tion?    A.  It  occurs  so  to  me. 

Senator  Taylor — Are  you  sufficiently  acquainted  with  the  differ- 
ence between  perishable  articles  and  fast  freight  and  express  matter, 
to  tell  what  it  is?  A.  Possibly  not.  It  is  quite  intricate,  and  requires 
a  good  deal  of  study. 

Q.  Give  us  an  illustration  of  what  you  would  term  perishable  arti- 
cles? A.  I  think  it  would  be  better  to  leave  it  to  some  railroad  man 
to  determine. 

Q.  What  would  you  say  about  household  goods?  What  class 
would  that  be  in  fast  freight,  express  matter,  or  perishable  matter? 
A.  Sometimes  it  depends  a  good  deal  upon  the  disposition  of  the 
owner.  If  he  wants  to  pay  for  fast  freight  he  puts  it  in  as  fast  freight. 
Some  men  would  put  in  almost  anything  as  fast  freight,  and  pay 
additional  charges. 

Q.  Supposing  that  it  was  not  desirable  to  pay  additional  charges 
as  fast  freight,  then  how  would  you  fix  it?  A.  Well,  if  it  was  perish- 
able it  would  certainly  be  the  disposition  of  the  owner  to  have  it 
for  warded  i  m  medi  atel  y . 

Q.  You  would  not  regard  household  goods  as  perishable  ?  A.  It 
depends  upon  what  they  were,  in  a  measure.  If  it  was  furniture  that 
was  in  a  car  out  of  the  weather.  I  would  not  conceive  that  it  was  per- 
ishable ;  but  if  it  was  on  the  platform,  in  the  event  of  a  storm,  it 
certainly  would  be  very  badly  damaged. 

Q.  That  is  the  place  where  it  becomes  necessary  to  determine  the 
class,  as  to  whether  it  is  perishable?  A.  Those  are  questions  which 
I  am  not  competent  at  the  present  time  to  determine. 

Q.  How  would  you  class  a  law  library,  or  the  library  of  a  physi- 
cian? A.  It  would  be  better  for  the  public  if  it  were  all  classed  as 
slow  freight,  and  kept  slow  all  the  time. 

Q.  How  about  agricultural  machinery,  such  as  reapers,  and  mow- 
ers, and  headers,  etc.?    A.  I  could  not  classif}'  them  as  perishable. 

Q.  How  as  to  being  fast  and  slow?  A.  If  the  harvest  was  ripen- 
ing I  would  want  them  fast. 

Q.  Supposing  that  you  were  to  deliver  to  the  company  ten  thou- 
sand tons  of  wheat,  or  a  million  feet  of  lumber,  for  transportation; 
do  you  say  that  it  should  all  be  transported  in  the  order  in  which  it 
is  received,  and  that  all  freights  which  were  not  perishable,  such  as 
agricultural  implements,  should  wait  in  the  order  of  its  reception 
till  all  this  other  freight  was  transported?  A.  No,  sir;  a  man  mak- . 
ing  a  contract  understands  what  he  is  doing. 

Q.  He  may  be  standing  upon  his  rights  in  transportation?  A.  He 
takes  it  at  his  own  risk. 

Q.  1  am  speaking  about  the  liability  of  the  company  under  this 


73 

bill;  whether  it  would  be  the  duty  of  the  company  to  transport  all 
this  freight  of  wheat  or  lumber,  if  it  were  received  first,  and  make 
the  law  library  and  the  agricultural  implements  and  household 
goods  await  their  order?  A.  That  is  a  question  of  law  that  I  am  not 
able  to  answer. 

Q.  If  this  bill  should  have  such  an  effect  as  that,  would  you  say 
that  it  should  pass  without  amendment?  A.  Say  that  it  should  be 
left  to  some  power  or  authority  to  regulate  those  matters,  I  would 
make  it  the  province  of  the  Railroad  Commission  to  determine  those 
matters. 

Q.  Then,  you  do  not  think  that  there  should  be  an  inflexible  rule 
requiring  that  freight  should  be  forwarded  in  the  order  in  which  it 
is  received,  with  the  single  exception  of  perishable  articles  and  fast 
freight?  A.  I  think  it  ought  to  be  left  to  the  Commissioners  to 
determine  wdiat  is  perishable  and  what  is  not.  If  it  is  not  perisha- 
ble, it  occurs  to  me  that  freight  should  be  forwarded  in  the  order  in 
which  it  is  received. 

Senator  Whitney — You  understand  that  railroad  business  should 
be  conducted  on  the  same  principles  as  other  business,  I  suppose,  and 
that  the  same  general  rules  should  be  applied  as  are  applied  to  the 
conducting  of  other  kinds  of  business?  A.  That  is  the  interest  of 
the  public. 

Q.  And  it  is  upon  that  ground  you  stated  that  you  thought  there 
should  be  discrimination  of  classes,  and  you  recognize  the  fact  that 
there  should  be  a  classification  of  freight  which  would  enable  the 
railroad  company  to  charge  more  for  certain  classes  than  they  did 
for  others;  for  instance,  more  for  silk  than  for  iron  ?     A.  Yes,  sir. 

Q.  How  would  it  be  in  regard  to  wheat?  Should  a  person  who 
ships  more  be  allowed  an  advantage  in  price  because  he  ships 
more?  A.  As  I  understand  it,  the  charter  and  the  right  of  way 
were  given  for  the  benefit  of  the  public,  and,  in  my  estimation,  there 
ought  to  be  no  difference  in  any  amount  of  cars  over  one;  of  course, 
if  you  break  bulk  in  less  than  a  carload,  there  ought  to  be  a 
difference. 

Q.  So  that  if  one  man  ships  a  hundred  carloads  of  grain,  and 
another  man  ships  ten,  he  should  have  just  the  same  advantage  as 
the  man  who  ships  a  hundred,  as  far  as  price  is  concerned  ?  A.  Yes,  sir. 

Q.  There  should  be  no  discrimination  in  regard  to  the  amount? 
A.  No,  sir. 

Q.  Do  j^ou  not  recognize  the  fact  that  a  railroad  company  can 
transport  a  large  amount  of  freight  much  more  economically  than 
they  can  a  small  amount?  A.  Yes,  sir;  but  there  is  this  point:  if 
there  are  ten  of  us,  and  we  each  have  a  carload  of  wheat  to  ship,  the 
railroad  company  can  transport  that  just  as  cheaply  belonging  to  all 
as  to  one. 

Q.  If  in  the  one  instance  you  had  a  hundred  carloads  to  trans- 
port, and  in  the  other  you  had  ten,  you  could  transport  the  hundred 
for  less  than  the  ten,  could  you  not?  A.  Yes,  sir;  and  that  is  just 
where  the  law  of  the  State  comes  in  to  say,  "we  are  willing  to  allow 
you  a  fair  rate  of  freight,  but  you  shall  not  discriminate  against 
shippers  where  each  has  less  than  a  carload." 


74 

Q.  Suppose  that  the  railroad  company  could,  by  adopting  a  classi- 
fication, increase  the  amount  of  freight  transported  from  one  to  two 
hundred  thousand  tons,  would  not  that  enable  them  to  make  a  less 
charge  for  each  ton?  A.  Possibly  it  would,  but  it  is  discriminating 
against  the  poorer  shipper. 

Q.  It  would  be  discriminating  against  the  railroad  company  if  they 
could  not  get  as  much  freight  also?     A.  Yes,  sir. 

Q.  Now,  looking  at  it  from  a  railroad  standpoint,  can  they  not 
afford  to  transport  for  me,  per  ton,  one  hundred  tons  of  freight  cheaper 
than  they  can  one  ton,  or  one  hundred  carloads  cheaper  than  they 
can  one  carload?  A.  If  they  were  only  going  to  get  one  ton  by  not 
contracting,  and  could  get  a  hundred  from  another  man,  then  I 
think  they  could ;  but  there  is  this  point  about  it:  the  presumption 
is  always  that  the  railroad  is  not  generous  enough  to  move  any 
freight  that  it  does  not  get  paid  for. 

Q.  If  I  agreed  to  give  them  all  of  my  freight,  could  they  not  afford 
to  do  it  cheaper  than  if  I  gave  them  only  one  ton,  and  gave  some- 
body else  the  other  ninety-nine  tons?  A.  I  think  that  broken  car- 
loads should  be  recognized  in  competition. 

Q.  If  I  had  a  hundred  carloads,  could  not  the  railroad  company 
afford  to  transport  them  cheaper  for  me  than  if  I  had  only  one?  A. 
I  think  they  could,  by  making  a  reduction,  and  by  a  general  reduc- 
tion, and  a  fair  average  of  freights,  they  could  get  the  whole  business 
anyway. 

Q.  If  thejr  could  not  get  the  whole  business,  except  by  making  that 
reduction,  do  you  think  that  they  ought  to  be  allowed  to  make  that 
reduction?  A.  I  think,  as  I  said  before,  that  that  is  where  the  regu- 
lations of  the  State  should  come  in  to  discriminate  between  heavy 
and  light  shippers,  provided  it  is  not  less  than  a  carload. 

Q.  Do  I  understand  you  that  a  railroad  company  can  afford  to 
transport  a  hundred  carloads  cheaper  than  they  can  one?  A.  If 
they  have  to  run  an  engine  with  one  car,  they  certainly  could. 

Q.  Suppose  that  they  could  not  do  it  with  one  engine,  but  had  to 
take  several?  A.  If,  by  one-car  lots  they  were  able  to  make  up  their 
train,  I  don't  see  where  the  advantage  would  come  in,  excepting  to 
the  railroad  company. 

Q.  Do  you  think  it  would  make  a  difference  with  the  railroad 
whether  they  shipped  five  hundred  or  live  thousand  carloads?  A. 
Yes,  sir. 

Q.  Then  any  arrangement  by  which  they  could  get  the  transporta- 
tion of  five  thousand  carloads  would  be  bettei^  for  them  than  one 
which  only  gave  them  five  hundred?     A.  At  the  same  rates,  certainly. 

Q.  Then  they  ought  to  be  allowed  to  make  that  much,  had  they 
not?  A.  I  think  there  comes  in  the  discrimination  again.  As  I  said 
before,  the  State  should  regulate  that  matter. 

Q.  You  think,  then,  that  they  should  be  compelled  to  ship  one 
hundred  carloads  at  the  same  price  per  carload  that  they  do  five 
thousand?     A.  I  think  so. 

Q.  Notwithstanding  it  would  cost  them  more?    A.  Yes,  sir. 

Senator  Kellogg — In  regard  to  the  discrimination  in  your  own 
case,  did  you  ask  the  conductor  for  a  stop-over  ticket  before  you  got 


75 

to  Elk  Grove?  A.  If  I  had  asked  in  time  I  presume  I  might  have 
got  it. 

Q.  Do  you  think  it  would  have  been  right  for  the  conductor  to 
have  delayed  the  business  of  the  road,  and  the  other  passengers  upon 
it,  for  the  purpose  of  issuing  you  a  stop-over  ticket,  when  you  could 
have  had  it  by  asking  for  it  in  time?  A.  The  wrong  was  for  them 
to  take  away  my  ticket  and  give  me  a  blank  check.  It  should  be  so 
arranged  that  I  could  get  off  anywhere  on  the  road  and  get  on  again. 

Senator  Vrooman — Two  merchants  have  each  a  hundred  thousand 
dollars  worth  of  goods,  one  sells  all  his  goods  to  three  men,  and  the 
other  to  twenty  thousand  men  ;  do  you  not  think  that  the  merchant 
who  sells  all  his  goods  to  the  three  men  can  afford  to  sell  them  for 
less  than  the  man  can  who  sells  to  twenty  thousand?  A.  I  can  see 
that  there  would  be  a  difference. 

Q.  Would  not  that  same  principle  run  through  the  railroad  busi- 
ness ?  If  they  have  a  hundred  thousand  tons  of  freight  to  transport, 
and  only  had  to  deal  with  one  consignor,  would  it  not  be  better  for 
them  than  to  have  to  deal  with  twenty  thousand  consignors;  could 
they  not  transport  a  hundred  thousand  tons  of  freight  cheaper  for  one 
man  than  they  could  for  twenty  thousand  ?  A.  I  think,  to  come  right 
down  to  dollars  and  cents,  they  could;  but,  as  I  have  said,  that  is 
where  the  province  of  the  State  comes  in  to  make  it  equal  between 
all  the  shippers  with  regard  to  quantity. 

Q.  In  other  words,  you  think  that  the  strong  arm  of  the  State 
should  be  interposed  in  this  case  to  prevent  the  same  rules  being 
applied  to  the  railroad  company  in  doing  its  business  as  is  applied 
to  the  merchant  in  conducting  his  business?  A.  There  is  a  differ- 
ence in  the  two  lines  of  business;  the  merchant  conducts  his  business 
absolutely  ;  the  railroad  owes  a  service  to  the  State,  and  consequently 
the  Stale  has  a  right  to  control  it  to  prevent  discrimination,  as 
between  the  large  and  small  shippers. 

Q.  You  think  that  the  power  of  the  State  should  interpose  its 
strong  arm  to  interfere  with  the  natural  laws  of  trade  which  govern 
other  kinds  of  business?  A.  Yes,  sir;  because  it  is  a  different  class 
of  business. 

Senator  Johnson — Do  you  think  that  any  railroad  company 
should  be  allowed  to  make  any  contract  with  the  owners  of  any  ves- 
sels, etc.  (reading  the  section  of  the  Constitution)?     A.  No,  sir/ 

Q.  Why  not?    A.  Because  it  is  against  the  Constitution. 

Q.  Is  it  against  any  principle?  A.  I  think  it  is  against  principle. 
If  you  have  any  regulations  at  all  you  should  certainly  have  the 
right  to  prevent  combinations. 

Q.  Do  you  mean  that  it  shuts  out  competition?  -  A.  It  certainly 
shuts  out  competition  where  several  carriers  agree  to  pay  the  same 
rate. 

Q.  Do  you  think  that  those  special  contracts  defeat  competition? 
A.  Yes,  sir. 

Q.  What  distinction  do  you  draw  between  them;  or  is  there  any 
to  be  drawn?     A.  I  did  not  say  any  should  be  drawn. 

Senator  Whitney— It  has 'been  objected  that  by  the  special  con- 
tract system  ships  are  kept  out  of  competition,  and  that  if  it  were 


76 

not  for  that  system  one  half  of  the  freight  that  now  comes  to  this 
coast  would  come  by  ships  and  the  other  half  across  the  continent. 
By  that  arrangement  the  railroad  companies  would  only  carry  half 
the  freight  which  they  now  carry.  The  price  across  the  continent 
then  would  necessarily  be  increased,  because  the  transportation 
would  be  increased.  Would  you  think  that  would  be  an  advantage 
to  the  people  of  the  State?    A.  In  the  long  run,  yes,  sir. 

Q,  So,  if  by  virtue  of  the  special  contract  the  State  gets  lower  rates 
of  freight,  you  think  it  would  be  better  off  than  if  it  paid  more  to 
the  railroad  company?     A.  Yes  ,sir. 

Q.  You  think,  then,  in  other  words,  that  it  would  be  better  for  the 
State  to  pay  open  rates  than  to  pay  special  contract  rates?  A.  Yes, 
sir. 

Senator  Taylor — Do  you  think  that  there  should  be  no  discrim- 
ination whatever  made  by  the  railroad  company  between  places 
upon  the  same  class  of  freight;  say  now,  for  instance,  in  the  single 
article  of  wheat;  should  they  not  be  allowed,  under  any  circum- 
stances, to  make  a  discrimination  in  the  amount  charged  as  freight 
upon  wheat  between  places?  A.  It  occurs  to  me  not;  that  has  been 
one  of  the  great  faults  found,  where  there  is  no  competition  by  any 
other  line — say  from  Stockton  to  Sacramento — the  rates  have  been  very 
reasonable  in  all  classes  of  freight,  except  where  there  is  no  competi- 
tion whatever,  and  no  other  transportation  line ;  there  they  have 
made  their  rates  very  heavy,  which,  it  occurs  to  me,  is  an  injustice. 

Q.  How  would  it  be  with  reference  to  their  being  allowed  to  dis- 
criminate, and  make  the  freight  less  per  ton  per  mile  from  a  point 
distant  from  the  seaboard,  than  it  was  from  one  nearer,  in  propor- 
tion to  the  distance  carried?  A.  It  gives  the  State  and  the  shipper 
the  benefit  of  having  it  uniform,  without  regard  to  competitive 
points. 

Q.  You  do  not  contend  and  would  not  maintain  that  there  must 
be  a  uniform  rate  per  ton  per  mile?  A.  It  depends  upon  the  dis- 
tance; for  instance,  it  might  be  and  ought  to  be  less  per  ton  per  mile 
from  Sacramento  than  from  Stockton;  because,  as  you  understand 
very  well,  the  chief  expense  is  in  loading  and  unloading.  The  bet- 
ter way  to  arrange  that,  it  occurs  to  me,  would  be  to  allow  a  terminal 
charge,  and  then  allow  a  uniform  rate  per  ton  per  mile. 

Q.  Supposing  that  there  was  a  uniform  rate  per  ton  per  mile,  and 
that  the  company  should  charge  that  rate,  and  not  be  allowed  to  dis- 
criminate between  a  competitive  point  near  the  seaboard  and  one 
that  was  farther  away,  would  that  be  right?  A.  I  do  not  understand 
you. 

Q.  If  wheat  could  be  shipped  at«two  cents  per  ton  per  mile  and  a 
party  was  within  ten  miles  of  the  shipping  point — that  would  cost 
him  twenty  cents  to  ship  his  wheat.  Now,  supposing  there  was 
another  point  four  hundred  miles  away  and  not  a  competitive  point; 
the  maximum  rate  being  two  cents  per  ton  per  mile,  the  wheat  raiser 
there  would  be  compelled  to  pay  $8  per  ton  to  get  his  wheat  to  the 
seaboard,  or  to  the  same  point.  Now,  ought  not  the  railroad  com- 
pany be  permitted  to  discriminate  in  favor  of  the  shipper  who  was 
four  hundred  miles  away?     A.  I  do  not  say  it.     There  should  be  a 


77 

difference  in  the  cost  of  loading  allowed  at  the  terminal  points, 
whatever  was  just,  and  then  he  should  be  charged  a  certain  uni- 
form rate  per  ton  per  mile. 

Q.  Assuming,  for  the  purpose  of  getting  at  the  point,  that  it  cost 
just  as  much  to  load  and  unload  at  one  point  as  at  the  other,  and 
leaving  that  out  entirely,  then  ought  not  the  company  to  be  allowed 
to  discriminate  in  favor  of  the  man  who  is  four  hundred  miles  away? 
A.  No,  sir ;  it  is  the  misfortune  of  the  farmer  who  has  got  so  far  back 
into  the  country.  • 

Q.  There  was  something  said  here  about  God  having  discriminated 
in  favor  of  San  Francisco.  If  that  is  the  case,  ought  not  we,  on  the 
same  principle,  to  be  allowed  to  discriminate  in  favor  of  our  own 
place,  or  in  favor  of  some  other  place?  A.  I  believe  that  the  Lord 
prepared  the  place,  and  that  the  people  found  it  when  they  went 
there.  I  don't  know  that  he  had  anything  to  do  with  it  except  pre- 
paring it  for  them. 

Q.  For  the  purpose  of  illustration,  we  will  take  the  Valley  of  the 
Sacramento,  or  of  the  San  Joaquin,  which  are  much  nearer  the  sea- 
board than  Siskiyou,  where  the  road  is  now  being  constructed.  In 
that  valley  the  farmers  raise  a  large  quantity  of  wheat,  and  they 
desire  to  market  their  grain  and  to  ship  it  to  the  seaboard.  Suppose 
that  the  maximum  price  were  two  cents  per  ton  per  mile,  and  that 
the  distance  was  four  hundred  miles;  that  grain  would  cost  eight 
dollars  per  ton,  say  to  Port  Costa,  whereas  at  the  present  time  the 
farmers  through  these  valleys  get  it  shipped  for  thirty  and  forty  cents 
per  ton.  Now,  would  you  say  that  no  consideration  whatever  should 
be  had  in  favor  of  that  locality?  A.  It  must  be  a  very  poor  farmer 
that  will  undertake  to  raise  wheat  for  the  San  Francisco  market  so 
far  away  from  the  market,  If  he  was  a  prudent  farmer  he  would 
turn  his  attention  to  something  else,  to  stock  raising,  for  instance, 
which  would  justify  him  in  paying  the  rates. 

Q.  So  you  would  not  allow  any  discrimination  in  their  favor,  but 
would  regard  them  as  poor  farmers?  A.  As  unfortunate  in  getting 
into  a  bad  place. 

Q.  Do  you  not  know  that  it  is  a  fact  that  wheat  is  shipped  a  dis- 
tance of  three  hundred  miles  to  the  seaboard?     A.  Yes,  sir. 

Q.  And  shipped  all  that  distance  by  reason  of  the  discrimination 
of  the  railroad  company  in  favor  of  that  locality?  A.  Yes,  sir ;  I 
know  that  it  has  been  the  case. 

Q.  Would  you  have  all  of  that  industry  stopped  to  prevent  the 
railroad  company  from  discriminating  in  favor  of  that  locality,  and 
cause  the  people  to  turn  their  attention  to  something  else?  Would 
that  be  right?  A.  It  occurs  to  me  that  if  I  had  a  contract  to  fix  I 
would  put  it  just  as  low  between  the  railroad  company  and  the 
farmer  at  that  distance  as  would  justify  the  railroad  company  in  car- 
rying it,  and  if  they  could  not  carry  it  to  the  seaboard  at  that  rate  I 
would  say  for  them  to  turn  their  attention  to  something  else.  The 
State  cannot  afford  to  accommodate  every  farmer  because  he  hap- 
pens to  get  away  back  in  the  backwoods.  The  whole  system  should 
not  be  overturned  simply  for  the  benefit  of  a  few  farmers  in  the 
interior. 


78 

Q.  Is  it  not  the  policy  of  the  State  to  attempt  to  settle  up  the 
country,  and  to  encourage  immigration  to  its  uttermost  parts?  A. 
Yes,  sir. 

Q.  How  would  that  policy  coincide  with  the  manner  in  which  you 
have  spoken  of  farmers  in  the  backwoods?  A.  There  are  various 
inducements  besides  farming. 

Q.  Suppose  that  the  lands  of  Siskiyou  County  are  especially 
adapted  to  raising  grain,  and  much  better  for  that  than  for  raising 
live  stock?  A.  If  they  are  adapted  for  raising  grain  they  are  for 
raising  live  stock  also. 

Q.  Well,  do  you  think  there  should  be  no  discrimination  allowed 
to  the  company  in  the  transportation  of  live  stock?  A.  Such  pro- 
duce will  bear  a  very  heavy  rate  of  transportation. 

Q.  Well,  as  between  the  farmer  who  lives  in  that  remote  section, 
and  one  who  lives  in  Sacramento  Valley,  must  they  all  be  treated 
alike?     A.  I  take  it  so;  yes,  sir. 

Q.  Suppose  that  the  business  which  is  done  by  the  company 
outside  of  the  transportation  of  wheat  and  stock,  is  such  that  they 
were  compelled  to  charge  the  maximum  rates?  A.  I  think  that  if 
they  were  allowed  to  discriminate  between  two  places,  and  to  take 
wheat  and  stock  and  other  products  at  such  rates  as  the  producers 
there  could  afford  to  pay,  and  transport  it  to  the  seaboard,  that  they 
could  lessen  the  whole  rate  of  freight  through  that  section.  I  think 
that  they  never  take  any  freight,  from  any  section,  that  does  not  pay 
for  taking  it  out;  that  they  have  their  rates,  and  always  will,  so  as  to 
make  a  profit  on  every  ton  of  produce  moved. 

Q.  Then  you  do  not  believe  in  the  idea,  that  the  more  business  the 
less  the  rate  ?  A.  Well,  the  principle  generally  holds  good ;  but  as  I 
said  before,  the  interests  which  the  State  have  in  railroads  are  such 
that  it  is  the  province  of  the  State  to  regulate  those  matters. 

Senator  Spencer — What  one  man  calls  discrimination  is  not 
discrimination  in  another  man's  mind.  In  other  words,  that  word 
discrimination,  as  used  in  fares  and  freights,  is  subject  to  a  good 
many  interpretations  ?     A.  Yes,  sir. 

Q.  You  mean  simply  to  be  understood  as  saying,  that  where  freight 
is  shipped  from  the  same  point  they  should  charge  the  same  rate  of 
transportation?    A.  Yes,  sir  ;  in  anything  above  a  carload. 

Senator  Cross  (Senator  Johnson  presiding) — I  understand  that 
you,  especially  in  the  relations  which  you  hold  to  the  State  Grange, 
and  to  the  journal  which  you  edit,  have  an  opportunity  to  become 
reasonably  familiar  with  the  agricultural  and  horticultural  interests 
of  the  State.  Do  you  believe  that  there  is  any  demand  in  the  State 
for  any  legislation  which  would  punish  any  person  for  acts  which 
they  neither  control  nor  are  in  any  degree  responsible  for  ?  A.  No, 
sir. 

Q.  Do  you  believe  there  is  any  demand  in  the  State  that  a  law 
should  be  passed  by  which  the  mere  bondholders  of  railroad  com- 
panies should  be  punished  for  the  acts  of  the  company?  A.  Well, 
of  course  the  charter  is  granted  on  certain  conditions  and  restric- 
tions. Every  stockholder  and  every  bondholder  knows  the  condi- 
tions when  he  takes  the  stock  or  bonds,  and  consequently  that  would 


79 

qualify  it  to  some  extent;  but  as  I  said  before,  that  while  I  agree  in 
the  main  features  of  the  bill,  and  possibly  the  penalties  attached 
may  be  too  severe,  yet  they  ought  to  be  sufficiently  severe  to  compel 
a  compliance  with  the  law. 

Q.  From  your  associations  with  the  people  of  the  State  and  with 
the  State  Grange,  do  you  believe  that  there  is  any  demand  that  pen- 
alties should  be  inflicted  upon  any  person  who  is  not  responsible, 
either  directly  or  indirectly,  for  the  act  for  which  the  penalty  is  in- 
flicted? A.  Well,  I  dare  say  that  it  would  occur  incidentally  and 
unavoidably;  but  as  I  said  before,  in  cases  of  bondholders,  they  take 
their  bonds  under  certain  restrictions,  knowing  that  the  Legislature 
has  the  power  to  forfeit  the  franchises  whenever  it  permits  discrim- 
ination or  violates  the  law. 

Q.  I  am  asking  you  whether  you  think  the  people  of  the  State 
demand  that  a  property  worth,  for  instance,  four  millions,  ought  to 
be  forfeited  because  one  carload  of  freight  was  forwarded  out  of  its 
order?  A.  Certainly  that  would  be  an  extreme  case.  It  ought  to  be 
in  such  shape  that  where  there  was  a  disposition  to  obey  the  law,  or 
by  any  mistake  or  otherwise,  freight  was  forwarded  out  of  its  order, 
they  should  not  suffer  the  penalty  without  there  was  a  general  dispo- 
sition to  disobey  the  law. 

Q.  Do  you  think  that,  from  your  knowledge,  and  the  associations 
you  have  had  with  the  people  of  the  State,  that  they  demand  that  a 
minority  of  the  stockholders  of  a  corporation  ought  to  be  punished 
for  the  act  for  which  the  majority  was  responsible  and  which  was 
against  the  wish  of  the  minority?  A.  That  is  just  how  the  minority 
generally  suffers  in  all  corporations. 

Q.  Do  you  think  that  the  people  of  the  State  demand  legislation 
inflicting  penalties  to  that  extent?  A.  In  this  case  it  would  be 
unavoidable,  in  order  to  compel  a  compliance  with  the  law. 

Q.  Do  you  not  think  that  the  people  of  the  State  and  the  State 
Grange  would  be  satisfied  with  penalties  being  inflicted  upon  those 
who  committed  the  act  of  discrimination?  A.  If  the  penalties  can 
be  so  shaped  as  to  be  sufficient  to  compel  a  compliance  with  the  law 
it  don't  make  much  difference  to  the  people  of  the  State  what  means 
are  used.  I  think,  so  far  as  the  bondholders  are  concerned,  if  they 
could  be  protected  in  consonance  with  the  interests  of  the  State  it 
would  be  done. 

Q.  Do  you  think  that  the  State  Grange  demands  that  if  there  are, 
for  instance,  twenty  stations  upon  the  road,  and  all  the  freight  is 
offered  at  one  of  those  stations  at  a  time  when  freight  is  also  offered 
at  another  station,  which  should  be  forwarded  first?  A.  As  I  under- 
stand the  bill,  it  simply  requires  that  all  freight  shall  be  forwarded 
in  the  order  in  which  it  is  received  at  each  station. 

Q.  Do  you  think  that  the  State  Grange,  or  those  whom  you  heard 
express  an  opinion,  would  be  satisfied  if  the  bill  provided  that  the 
freight  received  at  each  station  should  be  forwarded  in  the  order  in 
which  it  was  received  at  that  station?  A.  It  occurs  to  me  that  that 
is  the  spirit  of  the  bill  as  it  stands. 

Q.  I  am  not  allowed  to  ask  you  as  to  the  effect  of  the  bill.  I  am 
simply  asking  you  as  to  the  opinions  of  the  people  upon  these  ques- 


80 

lions  as  far  as  you  have  been  able  to  ascertain  them?  A.  There 
might  be  cases  where  it  would  work  injustice. 

Q.  Supposing  that  a  thousand  carloads  of  wheat  were  tendered  at 
one  time  at  Chico  and  that  at  the  same  time  a  hundred  tons  were 
tendered  at  Stockton,  do  you  think  that  it  is  required  by  the  people 
of  whom  you  speak  that  that  whole  thousand  tons  at  Chico  should 
be  moved  before  any  was  moved  at  Stockton?  A.  It  occurs  to  me 
that  that  would  be  discriminating  against  the  town. 

Q.  Suppose  that  a  quantity  of  live  stock  and  a  quantity  of  wheat 
were  tendered  at  the  same  time,  and  that  the  quantity  of  wheat  was 
sufficient  to  exhaust  all  the  cars  at  any  station  for  ten  days  (which 
would  be  possible  by  some  of  the  large  shippers,  I  believe),  do  you 
think  it  would  be  wise  legislation  to  fix  a  rule  so  that  all  the  wdieat 
should  be  forwarded  before  the  stock?     A.  No,  sir. 

Q.  In  the  meantime  the  stock  might  eat  up  the  profits  of  the  ship- 
pers, while  the  wheat  might  not  suffer  any  disadvantage  at  all?  A. 
Yes,  sir. 

Q,  Do  you  know  of  there  having  been  any  complaint  that  freight 
was  not  forwarded  in  the  order  in  which  it  was  received,  to  the 
injury  of  any  person?     A.  I  have  no  case  in  my  mind  at  present. 

Q.  Have  you  any  reliable  information  that  such  a  case  has  trans- 
pired within  the  State?  A.  I  do  not  recollect  any.  I  have  heard 
incidentally  of  cases,  but  none  sufficiently  important  to  present 
here. 

Q.  Not  of  sufficient  importance  to  present  with  reference  to  the 
enacting  of  a  law?    A.  No,  sir. 

Q.  Have  you  known  of  any  complaint  against  any  railroad  com- 
pany because  they  would  not  make  known,  upon  demand,  the  rates 
which  they  charged  for  carrying  freights  within  the  State?  A.  Not 
positively. 

Q.  Have  you  any  reliable  information  of  anything  of  the  kind? 
A.  I  do  not  knowT  that  I  have. 

Q.  Do  you  know  of  any  case  in  which  the  removal  of  any  struc- 
ture has  worked  any  hardship  to  any  person?  A.  What  do  you 
mean? 

Q.  Any  structure;  I  suppose  that  would  include  any  building, 
warehouse,  railroad  depot,  or  anything  of  the  kind?  A.  Not  to  my 
knowledge.     Only  from  what  I  have  heard. 

Q.  Have  you  heard  of  any  removals  which  worked  no. hardship? 
A.  I  do  not  think  of  any  at  present. 

Q.  Do  you  know  of  any  changes-  in  the  line  of  tracks,  or  roads,  in 
this  State  which  worked  no  hardship  to  any  person  ?  A.  I  think 
not. 

Q.  Do  you  know  of  any  place  in  the  Sierra  Nevada  Mountains 
where  the  track  has  been  removed  for  the  purposes  of  shortening  the 
line,  or  improving  the  grade,  and  then  relaid  in  a  different  place 
from  where  it  was  originally?  A.  Possibly  some  small  distances, 
but  nothing  material. 

Q.  If  such  changes  should  be  made  for  the  purpose  of  improv- 
ing the  grade,  or  anything  of  the  kind,  do  you  think  there  is  any 
demand  on  the  part  of  the  people  of  the  State,  or  of  the  State  Grange, 


81 

that  for  so  doing  the  railroad  shall  forfeit  its  charter?  A.  I  think 
not,  unless  it  was  done  intentionally  for  an  injury. 

Q.  If  it  were  done  merely  for  the  purposes  of  transportation,  you 
think  no  penalty  should  attach?  A.  Not  without  they  are  under 
obligation  to  the  town,  or  something  of  the  kind. 

Q.  Do  you  know  of  any  case  where  any  person,  or  the  State,  has 
suffered  in  any  way  from  any  railroad  company  within  the  State 
having  a  charter  from  any  other  State,  or  from  any  other  govern- 
ment besides  the  State  of  California?  A.  There  was  a  question 
before  the  Legislature  last  session  upon  that  point,  in  which  it  was 
claimed  that  if  it  operated  under  a  Federal  charter,  the  road  was 
released  from  its  obligation  to  this  State. 

Q.  Have  you  known  of  any  hardship  being  worked  within  the 
State  to  the  people  of  the  State,  or  of  any  person  within  the  State 
suffering  any  disadvantage  from  a  railroad  being  operated  within  the 
State  which  held  a  charter  from  other  States?  A.  I  think  there  is  a 
case  decided  which  would  bear  upon  that  question. 

Q.  I  will  ask  you  if  the  complaints  which  you  hear  are  not  with 
relation  to  rates  of  charges,  and  with  relation  to  non-payment  of 
taxes?    A.  Yes,  sir. 

Q.  They  complain  of  onerous  charges?  A.  Yes,  sir;  and  of  dis- 
criminations. 

Q.  The  discriminations  which  you  speak  of  grow  out  of  what  are 
called  special  contracts?  A.  I  understand  there  are  discriminations 
between  different  places  and  persons  in  different  parts  of  the  State. 

Q.  If  the  matter  of  discrimination  between  places  and  persons, 
and  the  matter  of  charges,  and  the  matter  of  taxes,  were  reasonably 
adjusted, xlo  you  think  that  the  demands  of  the  people  with  regard 
to  railroads  would  be  satisfied?  A.  Do  you  include  in  that  the 
special  contract  system? 

Q.  If  it  amounts  to  discrimination,  yes,  sir.  A.  Well,  sir,  it  would 
make  a  very  different  kind  of  feeling  from  wThat  now  exists. 

Q.  Are  not  those  the  real  complaints  of  the  people  of  the  State? 
A.  I  understand  so. 

Q.  Do  you  know  that  the  people  of  the  State  demand  that  the  rail- 
road charters  be  forfeited,  and  that  the  railroads  go  back  to  be  the 
property  of  the  people  of  the. State?  A.  No,  sir;  I  think  not.  Not 
with  any  equitable  disposition  on  the  part  of  the  companies  to  do 
the  service  of  the  State. 


Statement  of  Me.  Overheiser. 

Senator  Spencer — Where  do  you  live?     Answer — At  Stockton. 

Q.  How  long  have  you  lived  there?  A.  Since  the  Summer  of 
forty-nine.     I  am  a  farmer,  and  a  member  of  the  State  Grange. 

Q.  What  position  do  you  hold  in  that  body?  A.  Unfortunately,  I 
have  been  llio  State  Lecturer. 

Q.  How  long  have  you  belonged  to  the  State  Grange?  A.  Since 
its  organization  in  California,  for  ten  years. 

Q.  I  presume  that  from  the  position  you  occupy  in  the  State 
6b 


82 

Grange,  you  are  conversant  with  the  general  impressions,  and  of  opin- 
ions that  are  entertained  upon  the  question  of  freights  and  fares  in 
this  State?    A.  I  have  heard  the  expressions  of  many. 

Q.  Were  these  matters  ever  discussed  in  the  Grange  ?  A.  Not  to 
any  great  extent — somewhat;  but  you  have  got  about  all  the  infor- 
mation I  could  possibly  give  you  through  Mr.  Webster.  He  has 
given  it  as  near  as  I  possibly  can.  I  hardly  think  it  necessary  to  go 
over  that  again. 

Q.  Have  you  any  reluctance  to  testifying  here?    A.  Not  at  all. 

Q.  Do  you  know  anything  of  what  is  called  the  special  contract 
system  ?    A.  I  know  something  about  it. 

Q.  Will  you  be  kind  enough  to  state  without  these  formal  in- 
terrogatories, what  you  know  with  reference  to  any  discrimination 
practiced?  A.  I  will  state  right  here  that  I  have  never  seen  a  con- 
tract, or  examined  one,  but  I  am  connected  with  a  house  that  has  a 
contract,  and  it  is  through  the  manager  of  the  house,  and  its  direc- 
tor, that  my  information  comes.  Our  first  contract  was  broken  off 
by  the  railroad,  because  of  failure  to  live  up  to  it. 

Q.  Be  kind  enough  to  state  what  you  mean  by  "failure  to  live  up 
to  it."  A.  The  contract,  as  I  always  understood  it  and  as  I  under- 
stand it  to-day,  is  this:  That  a  party  making  the  contract  with  the 
railroad  obligates  itself  to  buy  of  no  person  except  those  who  have  a 
contract;  that  is,  of  no  importer.  They  are  forbidden  to  buy  of  any 
importer  that  sends  goods  round  Cape  Horn  or  by  water.  The  con- 
tract that  I  speak  of  was  broken  off  by  the  railroad  for  this  reason : 
a  firm  in  San  Francisco  got  out  of  a  certain  article.  Their  goods 
around  the  Horn  not  arriving  in  time,  they  applied  to  this  firm  for 
goods  and  the  goods  were  sold  to  them — goods  which  had  been 
Drought  across  the  continent.  They  were  shipped  from  the  depot  in 
Stockton  and  went  down  on  the  high  water  and  were  sold  to  this 
firm,  and  in  a  very  short  time  after  they  were  notified  that  their  con- 
tract was  void. 

Q,  The  firm  in  Stockton  had  one  of  these  special  contracts? 
A.  Yes,  sir. 

Q.  The  firm  in  San  Francisco  dealt  in  the  same  class  of  goods  that 
the  firm  in  Stockton  was  dealing  in,  and  the  firm  in  San  Francisco, 
having  refused  to  join  in  these  special  contracts,  wrote  up  to  the  firm 
in  Stockton  for  a  lot  of  goods?    A.  Yes,  sir. 

Q.  The  firm  in  Stockton  which  had  the  special  contract  complied 
with  the  request,  and  sent  them  a  carload  of  goods?  A.  Sold  them 
a  carload  of  goods. 

Q.  Have  you  any  objection  to  stating  the  character  of  the  goods  ? 
A.  A  carload  of  nails. 

Q.  About  how  much  did  the  firm  down  there  buy  ?  A.  Ten  or 
twelve  tons. 

Q.  And  after  they  had  shipped  these  goods  to  San  Francisco,  they 
received  notice  from  the  railroad  company  that  their  contract  was 
forfeited  ?    A.  Yes,  sir. 

Q.  Do  you  know  whether  that  was  put  into  effect,  or  whether  it 
was  a  mere  notice  ?    A.  It  was  put  into  effect,  as  I  understood.    The 


83 

house  changed  managers,  and  the  other  manager  went  to  San  Fran- 
cisco and  renewed  the  contract. 

Q.  State  whether  the  merchant  in  San  Francisco,  who  had  no  con- 
tract, to  whom  you  sold  these  subsequently,  got  a  special  contract? 
A.  The  merchant  I  have  reference  to  at  that  time  had  no  contract, 
but  since  that  time  he  has  been  coerced  (I  call  it)  into  the  contract 
system. 

Q.  Coerced  into  it?    A.  Pretty  near. 

Q.  Did  you  say  coerced  ?  A.  That  is  the  way  I  understood  it.  He 
refused  to  take  a  contract  a  long  time. 

Q.  Did  you  use  the  word  that  I  spoke  of,  or  did  I  suggest  it?  A.  I 
think  I  did  ;  I  felt  as  if  it  was  coercion. 

Q.  So  both  of  the  firms  have  contracts  now?     A.  Yes,  sir. 

Q.  Do  you  know  of  any  discrimination  practiced  by  the  railroad 
company  in  this  State  against  places,  or  do  you  know  of  any  instances 
of  any  threats  being  made  or  carried  out  by  the  railroad  companies? 
A.  I  know  of  threats. 

Q.  Will  you  state  the  extent  of  your  knowledge  as  to  whether  any 
discrimination  is  practiced  in  that  county  against  places  in  times 
past  by  the  railroad  companies?  A.  As  regards  fares,  I  have  some 
knowledge,  if  it  includes  that. 

Q.  State  the  discrimination  in  reference  to  fares,  and  illustrate  it 
as  near  as  you  can  ?  A.  I  have  had  favors  as  far  as  fares  are  con- 
cerned, but  I  learned,  by  traveling  over  the  road  from  Stockton  to 
San  Francisco  (for  a  dollar  and  a  half  by  second-class  fare),  that 
parties  can  go  from  Lathrop  to  San  Francisco  for  that  money.  Now 
a  ticket  to  Suisun,  which  is  nearly  half  way,  is  a  dollar  and  a  half. 
I  don't  know  whether  that  is  discrimination  or  not. 

Q.  You  are  on  the  same  car?     A.  Yes,  sir  ;  on  the  same  trip. 

Q.  The  same  conductor,  and  he  has  the  same  coat  on  ?  A.  Yes, 
sir.  In  going  from  San  Francisco  to  Stockton,  a  first  class  ticket  is 
three  dollars;  in  going  from  San  Francisco  some  six  years  ago,  I 
used  to  travel  the  road  very  frequently,  the  fare  was  four  dollars,  and 
from  Stockton  to  San  Francisco  at  that  time,  it  was  two  dollars. 

Q.  I  did  not  wish  you  to  go  back  to  that  time?  A.  I  only  wished 
to  cover  the  ground  because  there  has  been  a  change.  To  come  down 
to  the  present  time :  a  friend  of  mine  lived  in  San  Francisco,  he 
bought  a  ticket  to  come  and  the  price  of  a  ticket  was  three  dollars 
and  thirty  cents;  he  stopped  over  until  Sunday  at  Stockton  and  then 
came  up  on  his  ticket.  From  San  Francisco  to  Stockton  is  three 
dollars  if  you  stop  at  Stockton,  and  a  ticket  from  Stockton  to  Sacra- 
mento is  one  dollar  and  ninety  cents.  I  wish  to  make  a  correction 
of  one  of  Mr.  Webster's  declarations,  because  he  was  under  a  false 
impression.  The  fare  now  from  Stockton  to  Sacramento  is  one  dollar 
and  ninety  cents;  from  San  Francisco  to  Sacramento  is  three  dollars 
and  thirty  cents,  by  way  of  Stockton. 

Q.  And  from  San  Francisco  to  Stockton  on  the  same  train,  it  is 
three  dollars?    A.  Yes,  sir. 

Q,  Then,  if  you  want  to  go  from  Stockton  to  Sacramento,  you  pay 
one  dollar  and  ninety  cents  more?     A.  Yes,  sir. 

Q.  And  you  can  buy  a  through  or  stop-over  ticket  from  San  Fran- 


84 

cisco  to  Sacramento  for  how  much  ?  A.  Three  dollars  and  thirty 
cents. 

Q.  Then  if  going  the  whole  distance,  bjr  simply  getting  a  stop-over 
ticket,  you  make  how  much  ?     A.  Figure  it  up. 

Q.  Is  that  the  extent  of  your  knowledge  as  to  discrimination  in 
fares?  A.  I  don't  know  that  I  think  of  any  other  at  the  present 
time. 

Q.  State  where  the  principal  depot  or  station  is  with  reference  to 
Stockton?  A.  When  this  firm  that  I  have  reference  to  commenced 
business  some  six  or  eight  years  ago,  Stockton  was  evidently  left  out 
in  the  cold,  there  was  no  place  there.  You  could  not  ship  freight 
from  the  East  and  land  it  there.  We  had  to  go  to  San  Francisco 
for  goods,  or  to  Sacramento.  Since  that  time — I  don't  know  exactly 
the  time — Stockton  has  been  made  a  shipping  point,  and  now  we 
can  stop  our  cars  at  Stockton. 

Q.  What  is  the  principal  station  some  six  or  eight  miles  from 
Stockton?    A.  Lathrop. 

Q.  How  came  that  to  be  made  there,  do  you  know?  A.  Senator 
Baldwin  is  here  and  I  would  like  to  have  him  state  it,  but  I  will 
state  it  as  near  as  I  can.  When  the  railroad  was  about  getting  their 
right  of  way  to  build  their  road  they  came  to  Stockton  and  they 
wanted  to  go  through  the  center  of  the  city.  The  Common  Council 
objected.  They  could  not  make  any  arrangements  with  the  railroad 
magnates  and  they  left  in  disgust,  and  said,  as  I  understood  it,  "that 
they  would  cause  the  grass  to  grow  in  the  streets  of  Stockton  before 
they  got  through  with  it."  And,  gentlemen,  we  have  had  a  good  tug 
at  it,  although  there  is  not  much  grass  there  now. 

Q.  They  didn't  get  the  right  of  way  and  for  that  reason  they  put 
the  depot  down  at  Lathrop?  A.  They  did  not  get  the  right  of  way 
through  our  city,  but  went  outside  there  and  then  built  the  road,  and 
then  Stockton,  for  some  reason  or  other,  reached  out  and  took  them 
in  and  embraced  them. 

Q.  At  the  time  they  built  the  road  there,  was  there  any  special  rea- 
son assigned  for  making  Lathrop  a  station  ?  A.  The  reason  assigned 
was  to  make  a  pasture  of  the  City  of  Stockton. 

Q.  AVill  you  state  how  it  is  there  now  with  reference  to  transporta- 
tion by  water.  Can  you  give  us  the  facts  by  giving  us  the  history?  A. 
If  the  Senators  will  indulge  me.  I  came  to  Stockton  a  long  time  ago, 
before  there  was  any  town  there  and  before  the  railroad  was  an 
incorporation,  and  we  had  a  company  there  after  that  called  the 
California  Steam  Navigation  Company.  They  run  from  Stockton  to 
San  Francisco.  After  the  railroad  was  built  the  railroad  company 
bought  out  this  California  Steam  Navigation  Company  and  put  on 
their  own  boats.  A  man  by  the  name  of  P.  C.  Walker  put  on  an 
opposition  boat  and  run  it  for  some  little  time  and  it  was  bought  off 
by  the  railroad  and  he  was  employed  by  the  railroad  company  in 
their  shops.  After  some  little  time  had  expired  he  was  out  of 
employment  and  he  took  it  into  his  head  that  he  would  put  on 
another  opposition  boat,  and  he  went  around  among  the  citizens  of 
Stockton  to  get  them  to  sign  a  contract  that  they  would  patronize  his 
boat  at  a  certain  price  which  he  said  he  could  carry  freight  at,  which 


85 

was  very  much  lower  than  they  had  ever  paid  before.  They  signed 
the  contract  and  he  put  on  his  boat  and  commenced  freighting,  and 
the  people  were  very  anxious  that  he  should  carry  passengers,  and  he 
afterwards  changed  his  boat  so  as  to  accommodate  passengers  and 
carried  passengers.  During  that  time,  to  my  certain  knowledge,  this 
corporation  carried  passengers  for  nothing  to  try  to  break  that  boat 
up,  but  the  citizens  of  Stockton  stayed  right  with  their  agreement, 
and  the  result  was  that  in  about  three  or  four  months  the  railroad 
drew  off  their  boats  and  they  have  never  been  there  to  my  knowl- 
edge since.     The  water  is  all  that  saved  Stockton. 

Q.  If  it  had  not  been  for  the  water  communication  to  San  Fran- 
cisco, Stockton  would  have  been  in  a  bad  fix,  wouldn't  it  ?  A.  There 
wouldn't  have  been  any. 

Q.  What  were  the  rates  from  San  Francisco  to  Stockton  before  the 
railroad  was  built?  A.  I  can  hardly  tell.  First  the  fares  were  six- 
teen and  twenty  dollars,  and  then  it  ran  down,  and  I  have  not  kept 
the  run  of  it. 

Q.  What  were  the  rates  for  passengers  from  San  Francisco  before 
the  railroad  was  built,  or  there  was  any  railroad  communication 
direct  to  San  Francisco?    A.  I  do  not  recollect  exactly. 

Q.  What  do  you  know,  generally,  with  reference  to  discrimination 
against  localities  ?  A.  If  I  understand  the  point,  any  place  not  a  ship- 
ping point  from  the  East  have  to  pay  extra  to  those  points.  For 
instance,  if  a  merchant  at  Lodi  wanted  to  ship  a  carload  of  wire  from 
the  East,  they  have  got  to  ship  it  to  Stockton  or  Sacramento.  I 
believe  there  is  no  way  station  wdiere  they  will  switch  off  eastern 
freight  cars  till  they  get  them  there,  and  then  they  have  to  pay  back 
freight  back  to  Lodi. 

Q.  There  is  additional  freight  charged  for  pulling  that  back?  A. 
The  local  freight  is  always  charged. 

Q.  They  charge  the  local  freight,  notwithstanding  it  is  shipped 
past  Lodi  from  a  point  East?  A.  They  say  there  must  be  a  general 
terminal  point,  and  it  goes  to  Stockton — the  freight  paid  takes  it 
there — and  then  they  carry  it  back  to  Lodi.  Several  years  ago  they 
used  to  carry  it  to  San  Francisco,  but  since  Stockton  has  got  to  be  a 
terminal  point,  they  bring  it  there. 

Q.  And  then  they  charge  the  local  freight.  Do  you  know  any 
other  circumstances  of  discrimination  against  persons.  What  is 
your  knowledge  of  such?  A.  I  know  of  none  excepting  the  con- 
tracts. 

Q.  Is  that  the  subject  of  complaint  among  the  citizens  of  Stockton 
that  you  are  acquainted  with?     A.  No,  sir. 

Q.  Are  you  sufficiently  acquainted  with  the  commercial  commu- 
nity of  Stockton  to  know  whether  they  have  any  reluctance  in  mak- 
ing complaint  about  this  before  any  Court  of  justice,  or  in  going 
before  the  Railroad  Commissioners,  or  an  investigating  committee? 
A.  All  I  know  about  it  is  the  impressions  I  have  drawn  from  what  I 
have  heard. 

Q.  To  what  effect?  A.  I  would  be  very  reluctant  to  come  before 
this  body  and  state  what  firm  I  belong  to,  or  represent,  for  fear  that 
the  railroad  might  chastise  me  for  it,  or  my  firm. 


86 

Q.  Is  that  opinion  generally  shared  among  the  merchants?  A.  As 
I  understand  it,  that  is  the  general  opinion. 

Q.  What  do  you  mean  by  the  word  "chastise"?  A.  They  might 
take  our  contracts  away  from  us. 

Q,.  They  thus  work  forfeitures  for  a  simple  violation  of  their  con- 
tracts, do  they  ?  A.  I  cannot  say  that  they  do,  but  we  are  afraid  they 
will. 

Q.  Are  you  acquainted  with  the  mercantile  business  houses  in  San 
Francisco?     A.  I  think  so,  somewhat. 

Q.  Do  you  know  some  of  the  wholesale  merchants  down  there? 
A.  I  know  them,  but  personally  I  have  no  dealings  with  them.  The 
house  I  am  connected  with  has  a  manager. 

Q.  Have  you  examined  the  provisions  of  this  Barry  bill  in  rela- 
tion to  its  rules  of  shipping?  A.  I  looked  over  it  to-day  closely,  for 
the  first  time. 

Q.  Do  j'ou  see  anything  in  this  bill  that  would  militate  against 
the  commercial  interests  of  this  State?    A.  I  don't  know  that  I  do. 

Q.  I  will  ask  you  whether,  if  you  were  in  the  transportation  busi- 
ness, and  you  would  bring  goods  to  the  depot  to-day,  and  another 
man  should  bring  goods  there  to-morrow,  and  he  was  compelled  to 
wait  until  you  shipped  your  goods,  you  would  consider  that  an 
inequitable  rule?  A.  If  I  were  to  take  an  article  to  the  depot 
to-day,  and  you  took  yours  there  to-morrow,  and  yours  was  shipped 
first,  I  should  consider  that  I  was  badly  treated. 

Q.  You  believe  that  goods  ought  to  be  shipped  in  the  order  in 
which  it  is  brought,  so  far  as  it  can  be  conveniently  done?    A.  I  do. 

Q.  Do  you  believe  that  there  should  be  any  exception  with  respect 
to  perishable  articles?    A.  I  do. 

Q.  Do  you  believe  that  the  same  general  rule  should  be  observed 
with  regard  to  perishable  articles.  That  they  should  be  forwarded 
in  the  order  in  which  they  are  received  or  tendered  for  shipment? 
A.  I  do. 

Q.  You  think,  then,  that  each  man  should  have  equal  facilities  for 
transporting  his  goods?     A.  I  do. 

Q.  Do  you  think  that  live  stock  should  have  a  preference  over 
wheat  in  shipment?     A.  That  depends  upon  circumstances. 

Q.  Do  you  not  think  that  the  same  rule  should  apply  to  stock  as  to 
other  goods.  That  the  man  who  brings  his  stock  first  should  have  it 
shipped  first?  A.  If  I  understand  the  shipping  of  stock,  it  is  simply 
this:  in  order  to  secure  a  certain  kind  of  a  car,  you  must  give  your 
order  ahead  two  or  three  days.  It  is  but  just  to  notify  the  railroad 
company  that  you  want  to  ship  a  carload  of  stock. 

Q.  Isn't  that  the  general  rule  among  stock  dealers?    A.  Yes,  sir. 

Sknator  Whitney — Ought  not  this  bill  to  be  prepared  so  that  the 
railroad  company  should  receive  notice  of  intended  shipments? 
A.  So  far  as  stock  is  concerned,  I  think  it  had. 

Q.  You  think  an  amendment  to  that  effect  would  be  a  good 
amendment?  A.  It  occurs  frequently  that  the  railroad  folks  have 
not  a  large  number  of  cars  at  a  shipping  point,  and  that  it  would  be 
very  unjust  to  them  to  require  them  to  ship  a  carload  of  stock  with- 
out notice. 


87 

Q.  You  do  not  believe  that  they  should  be  required  to  forfeit  their 
charter  if  they  fail  to  do  it?  A.  I  think  not.  The  people  are  reason- 
able, as  a  general  thing. 

Q.  Do  you  think -that  the  people  of  Stockton  would  be  satisfied  to 
give  up  the  privilege  of  shipping  by  special  contract  and  go  back  to 
the  open  rates?    A.  I  think  they  would. 

Q.  You  think  that  they  do  not  consider  this  any  privilege  that 
they  have  of  being  made  a  shipping  point?  A.  By  being  made  a 
shipping  point — don't  misunderstand  me — we  want  to  be  a  ship- 
ping point.  We  would  not  be  willing  to  give  up  being  a  shipping 
point,  but  we  are  willing  to  concede  that  to  every  depot  on  the  road. 

Q.  Are  you  willing  that  Lodi  should  be  made  a  shipping  point  as 
well  as  Stockton?    A.  We  are  willing  that  all  should  be. 

Q.  There  is  nothing  there  now  that  compels  the  people  to  take 
these  special  contracts.  They  can  take  the  open  rates  if  they  prefer 
them?  A.  Yes,  sir;  but  I  never  heard  of  a  merchant  that  was  com- 
pelled to  take  that  special  contract  that  did  it  freely. 

Q.  What  is  the  objection?  A.  The  objection  is  that  the  railroad 
company  requires  them  to  do  certain  things.  They  prohibit  them 
from  trading  with  certain  men  on  this  coast  that  bring  their  goods 
around  Cape  Horn,  and  they  claim  the  right  by  the  contract  to  go 
into  the  office  and  examine  the  books  to  know  that  you  are  living 
up  to  your  contract. 

Q.  Nevertheless,  they  make  the  special  contract?  A.  They  are 
obliged  to  take  the  special  contract  to  protect  themselves. 

Q.  Because  it  is  an  advantage  to  them  to  do  so?  A.  Well,  if  A 
takes  a  contract  and  B  don't,  B  has  got  no  chance  at  all. 

Q.  So  that  the  special  contract  is  really  an  advantage?  A.  No,  sir. 
It  shows  compulsion,  no  advantage  about  it. 

Q.  It  is  an  advantage  to  A,  but  a  disadvantage  to  B?  A.  I  will 
illustrate  by  a  man  in  the  City  of  Stockton,  who  has  been  here  many 
a  time.  He  is  a  harness  maker,  and  he  told  me  here  at  the  conven- 
tion that  he  could  not  go  to  San  Francisco  and  buy  from  a  firm  there 
that  did  not  ship  by  railroad ;  that  he  was  prohibited  from  doing  that. 

Q  Do  you  know  the  reason  why  the  railroad  company  makes  these 
special  contracts?    A.  The  reason  is  to  control  freights. 

Q.  Why?     A.  To  get  business. 

Q.  In  other  words,  they  can  make  more  money  out  of  it  ?  A.  As 
a  matter  of  course. 

Q.  Do  they  make  more  money  out  of  it?  A.  They  can  prohibit 
the  produce  from  going  by  water  and  bring  it  across  the  continent. 

Q.  In  that  way  they  handle  a  larger  amount  of  freight,  do  they 
not?  A.  There  is  no  question  about  that,  if  they  can  prohibit  the 
shipping  of  it. 

Q.  And  if  they  handle  a  larger  amount  of  freight  they  can  afford 
to  do  it  at  less  rates,  looking  at  it  from  a  railroad  standpoint?  A. 
We  are  like  a  man  driving  swine,  we  do  not  like  to  be  coerced,  if  we 
do  we  turn  right  square  round. 

Q.  I  am  looking  at  it  from  both  sides.  A.  So  am  I;  I  am  a  rail- 
road man  in  one  sense  of  the  word.  We  couldn't  get  along  without 
them. 


88 

Q.  You  recognize  the  fact  that  the  more  they  ship  the  cheaper  they 
can  afford  to  carry  it?  A.  I  recognize  the  fact  that  they  are  in  com- 
petition with  vessels  that  carry  goods  around  Cape  Horn,  although 
they  cannot  ship  them  across  the  continent  as  cheap.  If  we  can  ship 
goods  cheaper  around  Cape  Horn,  then  let  them  go  around  there, 
and  if  it  is  cheaper  across  the  continent  then  let  them  go  that  way. 
Give  them  the  privilege  of  doing  as  they  please  about  it. 

Q.  They  can  do  that  now?  A.  No,  sir;  I  understand  that  they 
can't.  If  A  has  a  contract  and  B  has  none,  A  can  undersell  B, 
because  he  can  get  his  goods  quicker  across  the  continent,  and  in 
this  case,  it  seems  to  me  that  the  party  in  San  Francisco  is  an  illus- 
tration. One  of  the  largest  houses  in  San  Francisco  got  out  of  a 
certain  line  of  goods — out  of  nails.  The  ship  was  coming,  but 
did  not  get  in  in  time,  or  as  soon  as  expected ;  the  same  case 
I  referred  to.  Another  party  that  had  a  contract  was  out  of  goods; 
he  went  to  another  house  and  ordered  a  full  carload  of  goods — ten 
tons,  or  whatever  it  may  be.  The  goods  were  shipped  to  him  and 
hauled  to  the  landing  in  San  Francisco.  Now,  the  railroad  company 
sought  to  prohibit  that,  and  make  that  man  go  without  his  goods  till 
he  could  get  his  goods  around  Cape  Horn.     Do  you  see  the  point? 

Q.  Is  it  not  a  fact,  that  as  far  as  the  railroad  is  concerned,  they 
could  give  you  a  smaller  rate  if  you  gave  them  the  shipment  of  all 
your  goods?  A.  Will  the  Senator  allow  me  to  answer  the  question 
by  asking  one? 

Q.  Answer  the  question  in  your  own  way.  A.  The  question  was 
asked  to  Mr.  Webster,  who  was  just  here,  whether  the  man  who 
shipped  the  largest  amounts  ought  not  to  have  the  best  rates?  Now, 
I  will  take  a  man  and  put  him  on  a  farm  of  one  hundred  and  sixty 
acres  of  land,  and  he  raises  a  carload  of  wheat  there.  I  will  take 
another  man  there  that  raises  on  five  thousand  acres  of  land  as  much 
more  in  proportion.  Now,  according  to  the  argument  ot  the  gentle- 
man, the  man  that  raises  on  the  five  thousand  acres  should  have  his 
wheat  carried  to  market  cheaper  than  the  man  that  raises  wheat  on 
the  one  hundred  and  sixty  acres.  I  want  to  know  if  you  think  that 
is  correct? 

Senator  Whitney — I  do.    A.  You  do? 

Senator  Whitney — Yes,  sir.  A.  Well,  I  call  that  discrimination, 
and  making  the  rich  richer  and  the  poor  poorer. 

Q.  That  seems  to  me  the  common  rule  of  business.  A.  Here  is 
ten  thousand  acres  held  by  one  man,  and  he  is  a  farmer.  If  the 
same  land  were  cut  up  into  farms  of  one  hundred  and  sixty  acres 
the  wheat  would  go  over  the  road  at  the  same  rate,  and  the  company 
would  haul  just  as  much  wheat,  wouldn't  it? 

Q.  Yes,  sir.  A.  Then  every  man  would  have  his  freight  alike, 
wouldn't  he? 

Q.  If  I  am  to  answer  your  question,  I  will  say  that  they  do  not 
make  any  such  distinction  as  that.  In  fact,  I  understand  that  they 
haul  at  just  the  same  rate  that  they  do  for  five  thousand.  A.  I 
understand  they  do.  A  friend  of  mine  in  Merced  County  told  me 
that  it  cost  him  to  ship  a  carload  of  seed  wheat  from  San  Francisco 


89 

to  Merced  three  times  as  much  as  it  did  to  ship  it  from  Merced  to 
San  Francisco.     Now,  what  do  you  call  that? 

Q.  Isn't  that  one  of  the  abuses  that  the  Railroad  Commissioners 
have  lately  corrected  ?  A.  I  hardly  know  what  the  Commission  has 
done. 

Q.  Do  you  understand  that  that  hat'  been  corrected?  A.  No;  I 
do  not  understand  it. 

Q.  Is  it  not  your  idea  that  a  merchant  should  live  up  to  a  special 
contract,  if  he  makes  it?     A.  Not  if  he  is  compelled  to  make  it. 

Senator  Sullivan — When  did  this  occur  that  you  spoke  of,  of 
sending  the  seed  wheat  from  Merced  to  San  Francisco  ?  A.  Within 
eighteen  months. 

Senator  Cross — The  ingoing  freight  was  higher  than  the  outgoing 
freight  ?    A.  Yes,  sir. 

Senator  Whitney — That  is  no  longer  a  cause  of  complaint?  A. 
I  am  sure  I  do  not  know.  I  do  not  know  what  has  been  done  lately. 
These  complaints  I  have  heard  in  traveling  over  the  country. 

Senator  Cross — Do  these  special  contracts  relate  to  freights 
within  the  State  or  to  freights  across  the  State  line?  A.  I  think 
to  freights  from  the  East. 

Q.  It  relates  only  to  inter-State  confrnerce?     A.  Yes,  sir. 

Q.  Do  you  know  of  any  special  contracts  with  relation  to  carrying 
freights  wholly  within  the  State?    A.  No,  sir. 


Statement  of  N.  D.  Rideout. 

Senator  Cross — You  are  interested  in  a  railroad  near  Marysville? 
Answer — Yes,  sir. 

Q.  Running  where?    A.  From  Marysville  to  Oroville. 

Q.  How  long  is  that  road  ?  A.  Twenty-six  and  a  half  miles.  I 
suppose  the  idea  is  to  have  testimony  in  regard  to  this  Barry  bill,  in 
case  it  becomes  a  law,  and  the  effect  it  will  have  upon  transportation, 
upon  freight,  and  what  effect  it  will  have  upon  shippers,  the  benefits 
that  will  result  to  the  people,  and  vice  versa.  First,  as  to  section  one: 
"All  persons  and  companies  engaged  in  operating  any  such  road,  or 
in  transporting  freight  or  passengers  over  the  same,  or  which  shall 
hereafter  operate  or  engage  as  aforesaid,  shall  forward,  move,  and 
carry  impartially  for  all  persons  offering  freight  to  be  transported  or 
moved,  without  discrimination,  preference,  or  favor,  to  one  over 
another."  I  suppose  there  is  no  question  but  what  that  means  that 
the  railroad  company  is  to  charge  the  same  price  per  ton  for  all 
kinds  of  freight;  I  believe  that  is  the  construction  put  on  the  bill. 
I  simply  wish  to  state  that  it  is  impossible  to  run  a  railroad 
and  charge  the  same  rate  per  ton  for  all  kinds  of  freight.  It  is 
against  the  interest  of  the  people,  and  against  the  interest  of  the 
shippers  that  ship  freight,  and  also  against  the  interest  of  those 
who  have  freight  to  be  transported.  I  will,  in  a  few  words, 
give  my  reasons  why  I  think  it  is  against  the  interest  of 
shippers  to  pay  the  same  rate  per  ton.     For  instance,  on  this  little 


90 

Oroville  road  we  carried,  during  the  last  year — and  we  are  develop- 
ing quite  a  trade  in  lumber,  and  also  in  wood — we  carry  a  large 
amount  of  wood,  and  carry  it  very  cheap.  We  carry  wood  from  Oro- 
ville to  Marysville  for  six  dollars  a  car,  and  we  get  about  seven  dollars 
for  lumber.  The  merchandise  and  up  freight  pays — two  cars  at  about 
twenty-five  dollars  and  one  at  fifteen.  For  a  car  of  merchandise  we 
receive  about  twenty-five  dollars  a  car,  and  for  bran  and  millstuffs 
fifteen,  so  that  the  two  cars  up  freight  are  about  fifteen  dollars.  That 
is  the  daily  average,  and  we  take  down  each  day  a  car  of  grain  at  ten 
dollars  a  car,  and  a  car  of  lumber  at  seven  dollars,  and  wood  at  six 
dollars;  making  an  average  (figuring  up)  of  one  dollar  and  forty 
cents  per  ton  for  freight  carried  over  the  road.  Now,  it  would  not 
pay  to  operate  the  road  at  less  than  one  dollar  and  thirty  cents  or 
one  dollar  and  forty  cents  per  ton,  but  on  that  average  up  and  down 
we  make  a  very  fair  profit.  If  we  were  compelled  to  charge  the  same 
for  up  as  for  down  freight,  we  would  have  to  charge  upon  lumber, 
instead  of  seven,  fourteen;  for  wood,  instead  of  six,  fourteen;  and 
on  our  up  freight  the  same.  So  that  you  can  very  readily  see  how  it 
would  affect  us.  It  would  be  a  prohibition  as  far  as  lumber  is  con- 
cerned, and  also  wood;  therefore  we  would  carry  no  lumber  and  no 
wood.  If  we  had  two  carloads*  of  wood  at  twenty-five  dollars  a  car, 
and  one  at  fifteen,  it  would  make  an  average  of  three  cars  at  forty 
dollars,  and  we  would  have  to  raise  that  to  a  larger  amount  to  enable 
us  to  run  the  road.  Now,  during  the  last  year  there  has  been  a  V  flume 
built  forty  miles  up  on  the  ridge  between  the  North  Fork  of  the  Yuba 
and  the  South  Fork  of  Feather  Rivers,  and  it  is  bringing  lumber  to 
our  road,  and  wood,  and  it  is  the  expectation  that  they  will  carry 
this  through.  They  have  spent  one  million  two  hundred  and  fifty 
thousand  dollars  in  getting  it  in,  and  have  built  a  large  number  of 
sheds  for  the  wood  business.  There  has  been  a  great  amount  of  wood 
cut,  and  a  great  many  men  engaged  in  cutting  this  wood.  Now,  those 
wood  men  would  be  discharged,  and  the  men  would  go  to  some  other 
place;  and  we  think  that  would  be  detrimental  to  our  part  of  the 
State  and  retard  its  enterprises.  Our  lumber  business  is  increasing 
quite  largely,  and  there  is  now  a  mill  being  put  up  on  the  Peavine 
Ridge,  and  they  are  hauling  wood  in  wagons  to  Oroville.  We  are 
going  to  carry  that  freight  at  about  seven  dollars  a  car,  and  if  we  are 
compelled  to  charge  fourteen,  of  course,  the  mill  will  shut  down  and 
go  off  somewhere  else,  and  the  people  go  away;  which  is  again  a 
great  hardship  to  the  people  of  that  section.  It  is  a  detriment  to  the 
shippers,  and  they  don't  require  it  and  don't  demand  it.  If  it  is  put 
in  force  it  will  be  necessary  to  charge  more  for  up  merchandise,  and 
that  will  be  particularly  hard  on  the  merchants  of  Oroville.  If  we 
have  to  charge  them  forty  dollars  instead  of  twenty  or  twenty-five, 
of  course,  they  would  go  to  Some  other  town  to  trade — to  Chico,  or 
some  other  town  where  they  could  get  it  cheaper.  We  say  that  this 
section  of  that  bill  should  be  amended;  that  after  the  words,  "one 
over  another,"  there  should  be  inserted,  "offered  of  the  same  kind 
or  class,"  so  that  the  railroad  would  charge  the  same  price  for  the 
same  kinds  of  freight.  That,  of  course,  would  prevent  any  discrim- 
ination as  against  persons.     I  do  not  think  that  any  railroad  should 


91 

discriminate  against  persons,  and  as  far  as  our  railroad  is  concerned, 
they  are  punished  if  they  do. 

Senator  Del  Valle— Suppose  that  the  meaning  of  that  section  is 
just  as  you  want  it  construed — a  portion  of  the  section  at  least — that 
one  person  should  not  be  charged  more  than  another  as  to  difference  of 
the  price  of  goods,  and  that  goods  of  the  same  character  should  not 
be  charged  differently  to  different  persons ;  would  that  be  satisfac- 
tory to  you  ?    A.  Yes,  sir ;  but  if  that  is  meant  it  is  better  to  say  so. 

Q.  Suppose  that  you  illustrate  the  sentence  as  you  desire,  would 
that  be  satisfactory  to  you  ?    A.  No,  sir. 

Q.  From  that  you  would  imply  that  it  should  only  mean  that  there 
should  not  be  any  discrimination  against  persons?  A.  Against 
persons. 

Q.  How  does  that  discrimination  exist  now,  as  you  understand  it; 
is  it  the  special  contract  system  ?  A.  Discrimination  against  per- 
sons ?  I  don't  know  of  any. 

Q.  Do  you  construe  the  special  contract  of  the  Central  Pacific 
Railroad  to  be  discrimination  ?  A.  I  have  never  seen  any  special 
contracts. 

Q.  Do  you  know  of  the  existence  of  such  ?  A.  Only  from  what  I 
have  heard  ;  I  have  heard  that  there  are  some;»that  is  all  I  know. 

Q.  You  are  not  informed  of  the  facts?  A.  I  have  only  heard  gen- 
erally that  there  is  such,  and  that  every  man  can  sign  them  if  he 
wants  to.     I  never  saw  one  of  them. 

Q.  Does  that  railroad  belong  to  a  corporation,  or  to  you  alone?  A. 
It  belongs  to  another  man  and  myself. 

Q.  It  is  a  company  ?    A.  Yes,  sir. 

Q.  Have  you  read  the  remainder  of  that  section?     A.  Yes,  sir. 

Q.  What  is  your  statement  in  reference  to  that  portion  of  the  bill 
which  requires  the  company  to  carry  freight  in  a  certain  manner? 
A.  It  says  "all  freight  shall  be  dispatched  and  forwarded  in  the 
order  in  which  it  is  received  or  tendered  for  transportation."  That 
would  prevent  the  railroad  company  from  doing  any  business. 

Q.  Explain  that?  A.  I  think  they  would  do  some  business,  but  it 
would  not  be  a  satisfactory  business.  It  is  not  what  the  people  want. 
Of  course  the  clause  as  it  is,  without  amendment,  would 'be  con- 
strued that  any  man  that  had  any  amount  of  freight  (for  instance, 
wood  or  lumber),  and  notified  the  agent  that  he  wanted  the  freight 
shipped,  would  prevent  all  other  kind  of  freight  except  perishable 
articles  from  being  shipped  till  this  wood  was  all  taken  away*  Now 
I  will  take  a  simple  instance  in  regard  to  our  road:  These  men  are 
hauling  lumber  there  to  the  depot  and  piling  it  up;  now  a  man 
comes  to  us  and  says,  "  I  have  got  two  hundred  thousand  feet  of  lum- 
ber piled  up  here  beside  your  track;  I  have  an  order  from  San  Fran- 
cisco, and  1  want  to  ship  it;  order  the  cars  and  ship  it  as  soon  as 
possible."  If  there  is  two  hundred  thousand  feet  it  will  take  thirty 
cars  to  carry  it.  The  agent  says  to  the  man,  "Very  well,  I  will  get 
the  cars  here  as  soon  as  possible."  The  probability  is  that,  without 
taking  any  other  freight  on  our  road,  we  could  cany  that  in  five  or 
six  days — as  soon  as  we  got  the  thirty  cars.  In  the  meantime  if  a 
man  should  come  in  with  cattle  from  Big  Meadows,  or  Oregon,  as 


92 

they  do  every  little  while,  and  take  perhaps  four  or  five  cars,  and 
say,  "We  want  to  send  these  cattle  to  San  Francisco  as  soon  as  pos- 
sible; we  want  to  deliver  them  there  at  a  certain  time,  and  we  want 
to  ship  them;  it  will  only  take  four  or  five  cars."  The  agent  says, 
"Very  well,  as  soon  as  this  lumber  is  off  I  will  take  your  cattle,  but 
I  can't  do  it  before."  The  consequence  is  that  the  man  has  to  keep 
his  cattle  there  until  the  lumber  is  all  taken  away. 

Q.  Do  you  not  think  that  live  stock  ought  to  be  made  one  of  the 
exceptions  to  the  bill  as  to  the  transportation?  A.  Well,  I  think 
that  there  ought  to  be  the  same  amendment  put  right  in  there  that 
they  ought  to  be  of  the  same  class  or  kind.  When  I  have  got  twenty 
men,  all  having  lumber,  the  first  coming  with  his  lumber  ought  to 
have  it  shipped  first,  but  not  over  any  other  kind  of  freight. 

Q.  Suppose  that  I  came  with  a  lot  of  wheat  and  you  came  with  a 
lot  of  drygoods,  do  you  think  that  a  preference  ought  to  be  exercised 
there?     A.  I  think  there  should  be  a  preference  exercised. 

Q.  Why  so?  A.  Because  I  think  if  a  person  has  a  carload  of  dry- 
goods  that  he  wants  shipped  to  San  Francisco  or  Marysville  that  he 
should  not  wait  until  a  hundred  cars  of  wheat  were  shipped,  or  wait 
three  or  four  days,  or  a  week.  I  think  the  railroad  ought  to  be 
allowed  to  discriminate.  They  could  take  some  of  the  wheat  and 
take  the  drygoods,  and  not  block  up  their  road  with  one  class  of 
freight  to  the  exclusion  of  all  other. 

Q.  Supposing  that  it  was  of  the  same  character  as  barley  ?  A.  That 
is  about  the  same  thing,  of  course. 

Q.  Suppose  that  you  bring  a  carload  of  wheat  and  I  bring  a  carload 
of  barley  to  the  railroad,  and  that  I  bring  mine  first,  and  they  say, 
"  All  right,  I  will  take  your  carload,"  and  day  after  to-morrow  the 
car  comes  and  they  take  yours  in  preference  to  mine.  Under  your 
statement  that  should  not  be  prohibited.  Do  you  think  that  dis- 
crimination should  be  permitted?  A.  You  mean  as  between  barley 
and  wheat? 

Q.  Yes,  sir?  A.  Well,  they  are  about  the  same.  I  don't  know,  if 
you  allow  the  company  to  classify  freight,  as  I  think  you  must, 
whether  there  should  be  anything  to  compel  them  to  put  it  in  the 
same  class. 

Q.  They  don't  do  it  now?  A.  I  think  it  is  about  the  same.  The 
freight  is  about  the  same  on  wheat  that  it  is  on  barley — I  mean  on 
the  Central  Pacific. 

Senator  Cross — Is  barley  of  the  same  weight,  or  about  the  same, 
as  wheat?     A.  Yes,  sir. 

Q.  Weighs  about  fifty  or  sixty  pounds  ?  A.  Barley  is  a  little  the 
lightest.  I  think  that  they  charge  about  the  same  on  barley  that 
they  do  on  wheat. 

Q.  Suppose  that  a  man  brings  a  carload  of  wheat  to  Fresno,  to  be 
shipped  to  San  Francisco,  and  another  comes  witli  a  carload  of  wine, 
and  the  one  with  the  wine  comes  first,  but  the  wheat  is  shipped  first. 
Do  you  think  that  ought  to  be  permitted?  A.  If  there  was  only  one 
carload,  the  man  that  came  first  should  have  the  right  to  ship  first. 

Q.  Suppose  that  there  were  ten  carloads  of  wine,  and  five  carloads 


93 

of  wheat,  does  that  make  any  difference?  A.  Well,  for  that  matter, 
any  company  could  take  it  all. 

Q.  Supposing  they  can't?  A.  Well,  I  think  they  ought  to  be 
allowed  to  take  the  most  valuable  freight  first. 

Q.  You  think  that  discrimination  should  exist?  A.  I  do;  I  think 
that  the  railroad  company  ought  to  be  allowed  to  discriminate  so  as 
to  accommodate  their  customers. 

Q.  Do  you  think  that  they  should  be  permitted  to  discriminate  in 
their  freights  where  the  goods  are  not  oi  the  same  class?  A.  Yes, 
sir;  but  in  goods  of  the  same  class  there  should  not  be  any  discrimi- 
nation. 

Q.  How  many  classes  have  they  ?  A.  I  do  not  know.  We  do  not 
have  many  on  our  road. 

Q.  On  those  goods  as  classified  they  are  obliged  to  charge  a  differ- 
ent rate  for  every  different  class?  A.  I  think  they  do  charge  every 
class  a  little  different;  I  am  not  thoroughly  posted  on  that.  This 
road  of  mine  does  a  limited  business. 

Q.  There  is  another  portion  of  this  section  with  regard  to  prefer- 
ence of  one  over  another.  A.  I  am  not  talking  about  price,  I  am 
talking  about  dispatch.  Supposing  you  come  to  the  agent  of  this 
station,  and  say,  "I  have  ten  thousand  tons  of  wheat  here  that  I  want 
taken  away.  I  have  men  here  ready  to  load  it."  Under  the  pro- 
visions of  this  bill  we  could  take  no  other  business  till  that  is  all 
taken  away.  Now,  you  know  very  well  that  that  would  take  up  the 
business  of  the  road,  and  that  if  a  man  should  come  in  with  a  lot  of 
country  produce,  sheep,  hogs,  furniture,  or  anything  of  the  kind,  the 
company  could  not  take  it  till  that  ten  thousand  tons  of  wheat  were 
taken  away;  and  I  say  that  is  not  right.  I  say  it  is  injustice,  and 
that  the  company  ought  to  be  allowed  to  discriminate  in  such  cases. 
Of  course  I  concede  that  often  in  discriminating,  as  to  classes,  you 
make  trouble,  but  I  think  it  is  the  best  we  can  do.  Under  this  bill, 
if  a  man  has  ten  thousand  tons  of  wheat  he  might  control  the  road 
for  a  week  or  a  month  as  against  the  small  shipper.  Some  farmer 
might  come  in  and  want  to  ship  a  hundred  or  two  hundred  tons 
down  to  San  Francisco,  and  providing  we  could  ship  it  in  time  he 
could  sell  it  to  advantage;  and  if  the  other  could  monopolize  the 
shipment  for  a  month  he  controls  the  wheat  market,  and  the  man 
with  a  small  lot  has  got  to  sell  to  the  man  who  can  keep  it  on  hand 
a  month.  I  say  that  is  very  disastrous  to  the  small  shippers.  1  think 
this  bill  discriminates  between  them  in  favor  of  the  large  shippers, 
and  against  the  small  ones;  but  I  do  not  see  how  you  can  change 
this  bill  in  any  way,  except  to  allow  discrimination  as  to  classes,  and 
not  allow  it  as  to  one  class.  If  you  allow  a  man  a  preference  as  to 
class  he  will  then  get  the  advantage  of  the  small  shipper.  Suppose 
that  we  have  lumber  to  ship  from  Honcut  and  Oroville,  we  say  to 
the  man  at  Honcut,  "We  will  give  you  six  cars  to-day,  and  we  will 
take  the  others  on  to  Oroviile." 

Q.  What  amendment  would  you  suggest  there?  A.  The  only 
amendment  that  you  could  put  in  would  be  an  amendment  as  to 
freight  of  the  same  class  or  kind  :  "All  freight  of  the  same  class  or 
kind  shall  be  shipped  in  the  order  in  which  it  is  received  or  tendered 


94 

for  transportation."  Of  course  that  would  allow  the  man  with  the 
ten  thousand  tons  of  wheat  to  get  in  ahead  of  the  man  with  a  small 
number  of  tons,  but  still  it  would  allow  the  man  to  get  in  with  his 
furniture,  and  his  sheep  or  cattle. 

Q.  You  would  not  have  a  great  number  of  classes  for  your  road  ? 
A.  No,  sir. 

Q.  Do  you  know  the  classification  of  the  Central  Pacific  Railroad, 
or  the  Southern  Pacific  Railroad?  A.  No,  sir;  we  have  it  in  our 
office;  we  have  a  schedule,  but  I  do  not  remember  what  it  is. 

Q.  It  is  quite  a  volume?    A.  Yes,  sir;  quite  a  volume. 

Q.  Of  different  classes?    A.  Yes,  sir. 

Senator  Sullivan — I  understand  then,  that  you  are  perfectly  sat- 
isfied with  the  bill,  especially  with  section  one,  if  it  were  changed  as 
you  suggested  in  regard  to  class  and  kind?  A.  Yes,  sir ;  I  do  not 
think  it  would  hurt  our  road. 

Q.  Have  you,  on  your  road,  what  is  known  as  the  special  contract 
system  ?    A.  No,  sir. 

Q.  Whereby  you  discriminate  between  persons  and  persons?  A. 
No,  sir. 

Q.  I  believe  your  road  is  called  the  California  Northern  ?  A.  Yes, 
sir. 

Q.  What  is  the  length  of  it?    A.  Twenty-six  and  a  half  miles. 

Q.  Does  it  connect  with  the  Central  Pacific?  A.  Yes,  sir;  at 
Marysville;  and  also  with  the  water  communication  there.  We  get 
lots  of  freight  from  the  Central  Pacific. 

Q.  If  the  words  "  of  the  same  class  or  kind  "  were  inserted  in  there, 
would  it  not  do  away  with  the  very  object  for  which  this  bill  was 
passed  ?    A.  I  think  not. 

Q.  In  other  words,  would  it  not  allow  the  very  same  discrimina- 
tion that  has  been  practiced  by  the  railroad  companies  ?  A.  I  should 
say  not.     I  don't  see  how  you  can. 

Q.  Assuming  that  there  are  two  kinds  of  Avheat  or  of  barley,  and 
that  one  brings  in  the  market  fifty  per  cent  more  than  the  other,  you 
would  have  them  in  two  classes.  Wouldn't  that  allow  the  common 
carrier  to  discriminate  between  the  two  classes,  so  as  to  charge  the 
producer  more?  A.  Of  course  I  take  it  that  "  class  or  kind  "  there, 
would  mean  wheat,  and  that  wheat  would  be  but  one  class. 

Q.  Your  idea  would  be  to  put  wheat  in  one  class  and  barley  in 
another?     A.  Yes,  sir. 

Q.  Upon  your  own  road  have  you  discriminated,  and  charged 
according  to  what  the  commodity  would  bring  in  the  market?  A. 
No,  sir. 

Q.  It  is  shown  in  the  Railroad  Commissioners'  report,  and  has 
been  stated  here,  that  the  railroad  companies  make  a  distinction  in 
regard  to  charges  on  ore  according  to  the  value  of  it  in  the  markek 
I  will  ask  whether,  if  such  a  change  is  made  in  that  bill,  they  woula 
be  allowed  to  make  that  distinction  between  ores — say  in  Class  A  and 
those  in  Class  B — and  to  charge  more  for  ores  that  will  bring  fifty 
dollars  in  the  market  than  for  those  that  will  bring  ten  dollars?  A. 
Perhaps  they  had.  I  heard  Mr.  Yerrington's  testimony  in  regard  to 
that,  and   according  to  his  ideas,  if  they  are  correct  statements,  I 


95 

think  he  should  charge  more  for  ore  worth  forty  than  for  ore  worth 
ten  dollars;  otherwise  they  could  not  carry  ore  worth  but  ten. 

Q.  In  your  experience,  have  you  ever  known  a  railroad  to  trans- 
port merchandise  or  ore  that  did  not  pay  anything.  A.  I  never 
have  on  our  route.     I  don't  know  anything  about  others. 

Q.  Do  you  not  actually  refuse  freight  that  will  not  pay  you  to  ship? 
A.  I  will  answer  that  by  saying,  that  this  wood  that  we  are  carrying 
at  six  dollars  a  car,  pays  us  to  ship  at  cost  on  our  road.  If  the  cars 
were  not  going  up  with  merchandise  they  could  not  carry  wood.  In 
other  words,  if  we  had  to  take  that  and  nothing  else,  we  would  refuse 
to  take  it. 

Q.  You  are  of  the  opinion  that  the  charges  of  common  carriers 
are  arranged  according  to  what  the  goods  or  merchandise  will  bring 
in  the  market  ?  A.  Not  altogether ;  that  depends  upon  circum- 
stances. 

Q.  Take  the  cost  of  chairs,  for  instance.  The  chair  upon  which 
you  are  sitting  will  cost  about  two  dollars,  or  two  and  a  half.  Take 
walnut  chairs  of  the  same  kind ;  they  would  bring  two  dollars  and 
seventy-five  cents  in  the  market ;  they  take  up  the  same  amount  of 
space  in  the  car ;  they  are  not  any  more  trouble,  nevertheless,  the 
rate  upon  the  walnut  chair  is  more,  because  it  brings  twenty-five 
cents  more  in  the  market.  Do  you  think  that  is  right?  A.  No;  I 
think  they  should  be  charged  alike,  unless  there  is  some  difference 
in  the  insurance. 

Q.  Have  you  ever  known,  in  your  experience,  of  the  Central 
Pacific  Railroad    making  such  distinctions?    A.     No,  sir. 

Q.  You  would  be  surprised,  would  you  not,  to  learn  that  such  dis- 
crimination was  practiced?  A.  No,  I  don't  know  as  I  would,  if  it 
was  shown  ;  that  discrimination  that  you  speak  of  is  a  small  one. 

Q.  In  examining  you  I  only  desire  to  show  how  far  this  classifica- 
tion could  be  carried  out ;  then  I  ask  you  if  that  would  not  defeat 
the  very  purposes  of  this  Barry  bill?  A.  My  opinion  is  this:  That 
it  would  be  better  to  have  them  discriminate  than  to  block  up  the 
whole  commerce  and  trade  by  leaving  it  as  it  is.  You  can't  get  every- 
thing equal ;  you  can't  prevent* men  from  carrying  goods  from  the 
East  and  discriminating  in  any  particular  amount,  but  in  the  mean- 
while, the  whole  State  is  being  blocked  up,  and  the  railroad  com- 
panies are  prevented  from  carrying  on  the  business  of  the  State ;  I 
don't  think  it  is  right  in  principle  to  discriminate,  but  it  may  have 
to  be  done. 

Q.  In  your  intercourse  with  the  people  of  the  section  through 
which  your  railroad  runs,  of  course  you  have  occasion  to  make  con- 
tracts, and  to  arrange  about  transportation  and  freights?  A.  Yes, 
sir;  in  a  small  way. 

Q.  Have  you  ever  said  to  them  that  this  thing  ought  to  be  divided 
equally  between  the  carrier  and  the  producer;  that  is,  that  they 
ought  to  go  in  as  partners  in  the  sale  of  merchandise,  or  wheat,  or 
whatever  it  may  be  ?    A.  No,  sir. 

Q.  You  do  not  know  that  such  a  thing  has  been  done  upon  your 
road?    A.  No,  sir  ;  I  don't  think  it  has. 

Q.  Then,  with  these  amendments  that  you  spoke  of,  you  think 


96 

that  the  bill  is  a  good  bill?  A.  I  am  only  speaking  about  the  one 
clause.  I  think,  if  that  amendment  was  put  in  there,  allowing  them 
to  charge  different  prices  for  different  amounts  of  freight,  and  allow 
them  to  discriminate  and  reduce  one  class  and  take  another,  it  would 
be  satisfactory  to  our  road.  We  would  have  some  trouble,  as  I  said 
before,  about  taking  heavy  lots  of  lumber,  but  that  would  be  better 
than  excluding  all  other  kinds  of  freight.  I  don't  see  but  that  is  the 
best  amendment  that  you  could  put  in  there. 

Q.  You  are  aware  that  this  goes  further  than  making  discrimina- 
tions, and  that  it  strikes  at  the  question  of  freight?     A.  Yes,  sir. 

Q.  It  says  that  it  "Shall  forward,  move,  and  carry,  impartially,  for 
all  persons  offering  freight  to  be  transported  or  moved,  without  dis- 
crimination or  favor  to  one  over  another."  Don't  you  think  the 
amendments  you  propose  would  be  a  discrimination  between  person 
and  pers*on?  A.  No,  sir;  I  think  under  that  I  would  be  compelled 
to  charge  the  same  price  for  all  kinds  of  freight. 

Q.  If  that  section  does  not  mean  what  you  think  it  does  would  you 
be  satisfied  with  it?  A.  If  it  does  not  mean  that,  and  there  is  any 
question  about  it,  why  not  state  it  so  as  to  make  it  plain? 

Q.  Assuming  that  the  words  "  Class  or  kind  "  would  allow  discrimi- 
nation again,  then  would  you  not  be  sorry  that  the  bill  was  so 
amended?  A.  Well,  you  can't  make  the  thing  any  worse  than  it  is 
now,  and  you  might  make  it  better.  You  desire  to  punish  people 
for  making  discrimination  against  persons;  it  ought  to  be  to  punish 
them  for  discrimination  against  crime. 

Senator  Taylor. — "Without  favor  to  one  over  another,  in  price, 
dispatch,  speed,  or  accommodation  of  any  kind."  As  the  bill  reads 
do  you  think  that  it  would  prevent  discrimination  by  the  railroad 
company  by  reason  of  distance?  A.  I  was  taking  that  in  connection 
with  section  two.  You  will  notice  line  seven.  Take  that  in  con- 
nection with  section  one  and  you  would  have  to  charge  the  same  rate 
per  car  for  all  distances. 

Q.  I  understand  you  to  say  that  you  have  two  stations  upon  your 
road — one  called  Honcut  and  the  other  Oroville?    A.  Yes,  sir. 

Q.  And  that  your  general  rate  is  seven  dollars  a  car  for  lumber? 
A.   We  are  carrying  some  lumber  for  that. 

Q.  If  you  charge  the  shipper  seven  dollars  a  car  for  lumber  at  Hon- 
cut, and  it  is  only  half  the  distance  that  it  is  to  Oroville,  in  order  to 
comply  with  this  bill,  and  not  discriminate  in  price,  would  you  not 
be  compelled  to  charge  fourteen  dollars  from  Oroville  per  car?  A. 
That  is  the  way  I  look  at  the  bill. 

Q.  Is  that  the  way  you  do  now?  A.  No;  we  charge  six  dollars  to 
Honcut  and  seven  to  Oroville.     That  is  about  our  rates. 

Q.  If  the  rates  were  uniform  between  the  two  places,  per  mile,  per 
ton,  you  would  have  to  charge  twice  as  much  from  Oroville  as  from 
Honcut?     A.  Certainly;  that  is  a  matter  of  figures. 

Q.  The  shipper  at  Red  Bluff  would  have  to  pay,  if  there  was  no 
discrimination  in  price,  per  mile,  per  ton,  much  more  for  his  freight 
than  the  man  would  who  lived  in  San  Joaquin  Valley?  A.  There 
is  not  much  difference  in  distance  in  the  two  places. 


97 

Q.  The  distance  from  Red  Bluff  is  nearly  three  hundred  miles? 
A.  About  two  hundred  and  twenty-five  miles. 

Q.  Then,  under  this  bill,  at  the  same  rate,  per  ton,  per  mile,  what- 
ever the  distance  might  be?  A.  That  is  the  way  it  seems  to  me.  I 
may  not  be  right  in  regard  to  that,  but  I  should  say  that,  taking  the 
bill  altogether,  without  amendment,  it  would  be  that  you  would  have 
to  charge  the  same  rate,  per  mile,  per  ton.  Of  course,  then  your  men 
in  the  valley  would  have  to  pay  a  pretty  high  price  for  wheat,  per  ton. 

Q.  Do  you  have  any  idea  that  that  would  prevent  the  raising  of 
grain  in  some  places?     A.  If  they  were  too  far  off  it  would. 

Q.  How  is  it  in  regard  to  that  at  the  present  time?  A.  The  farther 
they  get  away  the  less  rate  they  pay  per  mile  per  ton.  It  would  not 
bear  shipment  if  they  paid  the  same  rate.  In  other  words — at  the 
end  of  the  road  they  would  not  get  as  much  per  ton  for  it  as  they  do 
now. 

Q.  How  would  it  be  with  regard  to  cattle?  A.  I  could  not  say 
positively  in  regard  to  that.  The  principal  places  where  cattle  are 
shipped  in  Sacramento  Valley  is  in  Cottonwood  and  at  Chico  ;  some 
from  Marysville. 

Q.  Is  it  not  a  fact  that  during  the  time  when  the  harvest  is  ripe 
and  wheat  is  being  shipped  cattle  are  procured  in  California  for  the 
San  Francisco  market?  A.  To  a  limited  extent.  Most  all  of  the 
cattle  come  from  the  outside. 

Q.  Is  it  not  a  fact  that  nearly  all  the  cattle  come  from  Oregon  and 
Nevada  and  other  places  without  the  State  of  California  in  the  Win- 
ter, and  when  there  is  no  wheat  being  shipped?  A.  Yes,  sir,  I  think 
there  are  more  cattle  shipped  then  than  during  the  Summer. 

Q.  Then,  under  this  bill,  if  the  company  were  required  to  trans- 
port freight  in  the  order  in  which  it  is  received,  would  there  be  any 
great  hardship  or  inconvenience  raised  if  they  were  compelled  to  take 
the  cars  which  they  were  using  for  one  purpose  and  use  them  for  the 
other?    A.  I  have  already  stated  that. 

Q.  And  you  have  stated  that,  in  your  opinion,  it  would  completely 
bar  out  the  smaller  shippers  by  the  large  ones?  A.  Yes,  sir;  it  looks 
so  to  me. 

Senator  Kellogg — What,  in  your  opinion,  is  the  effect  of  a  slid- 
ing scale  of  prices?  If  a  mandatory  rule  was  established  upon  long 
hauls,  what  would  be  the  effect  upon  the  industries  of  the  interior  of 
the  State — would  it  be  beneficial  or  otherwise?  A.  It  would  be 
otherwise.  I  think  the  rates,  as  now  established,  discriminating, 
and  charging  less  rate  per  mile  for  long  distances,  betterfor  the  State 
than  to  make  that  rule. 

Q.  Would  it  not  almost  cripple  the  interior — say  three  or  four 
hundred  miles  from  the  seaboard — to  undertake  to  establish  a  posi- 
tive rate  per  ton  per  mile  upon  wheat  and  farm  products?  A.  I 
think  so.  I  think  that  Senator  Taylor's  constituency  up  in  the 
mountain  valleys  would  have  to  go  into  another  business. 

Senator  Vrooman — There  is  an  exception  made  here  as  to  perish- 
able articles  and  fast  freight.  Isn't  it  a  fact,  that  cattle  are  generally 
shipped  as  fast  freight  ?  A.  Not  in  my  experience.  The  cattle  trains 
go  down  the  road  along  past  Marysville  on  the  same  trains  as  wheat. 

7b 


98 

Q.  That  is  in  small  lots,  but  where  there  is  a  large  quantity  there 
is  a  lot  of  special  cars,  is  there  not?  A.  I  don't  know.  I  never  knew 
any  cattle  in  Sacramento  Valley  to  be  shipped  on  any  other  trains 
than  the  freight  trains  ;  it  may  be  different  in  other  parts  of  the 
State. 

Q.  Has  your  experience  been  with  many  carloads,  or  only  with  a 
few?  A.  Sometimes  ten  to  fifteen.  I  have  seen  as  many  as  twenty- 
five  or  thirty  going  along  the  road;  and  sometimes  a  lot  of  special 
freight  trains  going  and  coming  on  the  same  time  as  the  other  freight 
trains.  As  I  understand  the  time  table  the  freight  trains  are  all 
limited  to  so  many  miles  per  hour. 

Q.  Don't  you  consider  them  as  belonging  to  that  class  of  freight? 
A.  I  never  considered  it  so;  I  never  heard  it  mentioned. 

Q.  What  is  fast  freight?  A.  Sometimes  they  put  a  freight  car  on 
the  passenger  train  going  to  Ogden  or  Omaha.  I  have  seen  them 
going  by  here.     That  is  fast  freight. 

Q.  All  freight  would  not  come  under  that  head?  A.  I  should  say 
not.  I  don't  know  of  any  fast  freight  trains  that  have  been  run  in 
this  State  as  freight  trains.  I  think  they  all  run  on  the  same  time, 
and  that  any  fast  freight  that  has  been  carried  has  been  attached  to 
a  passenger  train.     That  is  my  opinion;  the  same  as  any  fast  matter. 

Q.  They  speak  in  ordinary  phraseology  of  fast  and  slow  freight. 
Does  it  mean,  in  the  ordinary  acceptation  of  the  term,  the  cars 
attached  to  a  passenger  train?  A.  I  don't  know  about  that.  I  think 
in  the  East  they  have  a  fast  train  at  a  different  rate  of  speed.  It 
may  be  so;  I  don't  know. 

Senator  Cross — How  would  the  law  work  if  a  large  amount  of 
down  freight  were  tendered  before  any  up  freight,  or  a  large  amount 
of  up  freight  before  any  down  freight,  and  you  were  compelled  to 
take  all  of  the  down  freight  before  any  of  the  up  freight  was  trans- 
ported, or  vice  versa?  A.  Of  course  that  wouldn't  work.  Are  you 
alluding  to  this  bill  now? 

Q.  I  think  I  am.  Supposing  that  a  thousand  carloads  of  wheat 
were  tendered  to  you  on  Monday,  and  that  on  Tuesday,  Wednesday, 
and  Thursday  other  freights  were  tendered  from  San  Francisco,  Oak- 
land, and  other  points;  what  would  be  the  effect  if  all  that  down 
freight  had  to  be  hauled  before  any  up  freight  subsequently  tendered 
could  be  hauled?    A.  Of  course  that  would  have  a  bad  effect. 

Q.  Would  it  tend  to  increase  the  price  which  would  have  to  be 
charged  for  freight  in  order  to  enable  the  transportation  company  to 
realize  a  profit?  A.  I  don't  see  how  that  would  cut  much  figure;  it 
would  injure  the  shippers  more  than  the  railroad  company. 

Q.  How  would  it  injure  the  shippers?  A.  If  the  freight  came 
from  San  Francisco  it  certainly  would;  we  would  have  to  haul  the 
cars  up  without  it  that  had  been  previously  sent  down. 

Q.  How  would  a  law  work  which  provided  that  if  a  thousand  tons 
of  freight  were  tendered  at  Red  Bluff  at  nine  o'clock,  and  five  tons 
at  Marysville  at  eleven  o'clock,  you  would  be  required  that  the  whole 
of  the  thousand  tons  tendered  at  Red  Bluff  should  be  carried  before 
any  of  this  at  Marysville?  A.  If  that  was  the  law  I  would  think  it 
was  bad.  It  would  be  simply  an  inconvenience  to  the  man  at  Marys- 
ville. 


99 

Q.  What  effect  would  it  have  upon  the  intermediate  points?  A. 
It  seems  to  me  that  the  question  answers  itself.  I  don't  see  any  need 
of  answering  a  question  like  that. 

Q.  You  think  that  the  law  which  made  a  provision  like  that  would 
be  upon  its  face  absurd?  A.  I  certainly  think  so;  I  don't  see  that 
this  bill  does  that. 

Q.  What  it  says  is  a  question  of  law.  I  ask  you  if  that  is  so,  what 
would  be  the  effect?  A.  It  would  be  very  bad,  of  course;  anybody 
can  answer  that. 

Q.  If  a  rate  were  adopted,  and  it  was  uniform  as  to  all  kinds  of 
freight,  would  there  be  any  kinds  of  freight  which  you  now  carry 
which  you  would  not  then  be  able  to  carry?     A.  Yes,  sir. 

Q.  Would  it  increase  or  diminish  the  prices  which  would  have  to 
be  charged  for  all  classes  ©f  freight?  A.  It  would  be  an  inconven- 
ience, of  course. 

Q.  Supposing  that  a  uniform  rate  were  required  upon  all  kinds  or 
classes  of  freight,  including  furniture,  would  that  increase  or  diminish 
the  rates  which  would  have  to  be  charged  for  transportation  of  crops 
from  the  country  to  the  seaboard?  A.  It  would  increase  the  down 
freight;  bound  to.  Of  course,  the  wheat  in  the  Sacramento  Valley 
is  taken  to  San  Francisco  at  a  very  reasonable  rate;  from  Marysville, 
two  dollars  and  forty  cents ;  from  the  other  side,  two  dollars  and 
fifty  cents. 

Q.  Some  questions  were  asked  you  concerning  special  contracts. 
Have  you  ever  read,  or  have  you  any  knowledge,  of  any  special  con- 
tract which  related  to  other  than  inter-State  commerce?    A.  No,  sir. 

Senator  Vrooman — "All  persons  and  companies  shall,  at  all 
times,  keep  posted  in  a  conspicuous  place,  etc.,  a  printed  table  or 
schedule  of  all  rates  of  freight  and  charges  in  force  for  transporta- 
tion between  all  points  and  stations  to  or  from  which  they  carry," 
etc.  What  is  your  idea  in  regard  to  that  provision?  A.  I  should 
say,  that  I  do  not  think  it  necessary  to  keep  at  every  station  a  sched- 
ule of  the  rates  of  freight  between  all  the  different  stations  in  the 
State.  In  other  words,  I  do  not  think  that  they  ought  to  be  com- 
pelled at  Honcut  and  Oroville  and  Marysville,  to  keep  tne  rate  of 
freight  between  Los  Angeles  and  other  different  points.  I  don't  see 
any  need  of  it;  it  would  be  of  no  benefit  to  the  shipper.  I  should 
say  that  there  ought  to  be  an  amendment  put  in  there;  something 
to  this  effect,  "To  the  particular  stations  to  which  they  carry  ;"  that 
ought  to  be  put  in  there:  "  At  the  office  or  station." 

Senator  Sullivan — Do  I  understand  you  to  say  that  you  think 
they  should  only  have  a  schedule  at  the  point  or  station  where  the 
goods  are  shipped  to?  A.  From  that  station  to  all  other  points  to 
which  they  ship  them. 

Q.  Then  you  would  amend  it  in  that  respect?  A.  I  would  say 
that  at  the  stations  from  which  freight  is  to  be  shipped,  they  should 
keep  a  schedule  of  the  rate  from  that  station  to  all  the  stations  for 
freight  upon  the  road.  "Such  rates  shall  be  equally  available,"  etc. 
I  don't  know  about  that.  I  don't  know  whether  that  would  compel 
us  to  charge  the  same  rates  per  mile  or  not.  The  amendment  in 
section  first  would  perhaps  cover  that.     You  might  amend  it  if  you 


100 

kept  the  first  section.  "  Different  rates  may  be  charged  for  fast 
freight,"  etc. ;  I  think  that  is  all  right. 

Q.  What  do  you  understand  by  the  word  "rebates,"  on  line  ten? 
A.  That  is  to  charge  a  man  a  certain  price  and  then  pay  him  some 
back  afterwards.     We  do  not  do  that. 

Q.  You  have  an  open  rate  for  all?  A.  Yes,  sir.  I  understand  that 
"rebate"'  is  this:  A  man  often  goes  to  the  railroad  company  with 
some  proposition  for  us.  We  say :  "  We  will  ship  your  goods  provided 
you  ship  a  thousand  tons ;  go  on  and  ship  and  we  will  make  you  the 
regular  charge.  If  you  ship  the  full  amount,  we  will  pay  you  some- 
thing back." 

Q.  There  is  no  such  customer  upon  your  road?    A.  No,  sir. 

Senator  Kellogg — Are  you  well  enough  acquainted  with  the 
system  of  rebates  to  explain  to  this  committee  just  what  it  is  as 
practiced  on  the  eastern  and  western  roads  and  the  roads  in  Cali- 
fornia, so  far  as  freights  and  fares  are  concerned  ?  A.  I  don't  know 
that  I  am. 

Senator  Cross — Suppose  that  in  shipping  freight  there  should  be 
an  overcharge  made,  and  that  it  was  afterwards  discovered,  and  the 
money  be  paid  back,  would  that  be  a  "rebate?  "  A.  No,  I  think  that 
would  be  an  error,  or  overcharge. 

Q,  Wouldn't  that  be  "rebate?"  A.  No;  I  think  not.  You  are  a 
lawyer;  you  can  tell  better  than  I  can. 

Q.  I  didn't  know  but  the  word  might  have  a  technical  meaning  in 
the  railroad  business.  A.  Sometimes;  for  instance,  a  theater  com- 
pany comes  along  and  says  :  "  We  have  got  twenty-five.  We  can't 
afford  to  pay  you  the  regular  rate."  I  say,  "All  right;  if  there  is 
twenty-five,  we  will  take  them  at  a  certain  price.  If  there  is  less  than 
twenty-five,  you  can  pay  the  regular  rate." 

Q.  How  would  it  be  in  regard  to  commutation  tickets.  I  suppose 
that  would  not  apply  to  that  class  of  freights?  A.  I  suppose  not. 
It  might  be  in  a  technical  sense.  Well,  that  is  section  two.  There 
you  provide  for  some  discrimination,  and  I  don't  see  why  you  should 
object  to  it  in  section  one.  I  think  it  should  be  the  same  all  the  way 
through.  I  think  the  company  should  be  allowed  to  discriminate 
some,  and  that  they  should  be  allowed  to  discriminate  some  under 
section  one.  Now,  we  will  go  on  to  section  three  (reading  it).  I  wish 
to  say,  in  regard  to  that  section,  that  I  cannot  see  what  benefit  it 
could  be  to  the  shipper,  or  to  the  people,  or  to  the  seller,  if  the  rail- 
road company  are  responsible.  If  their  road  got  out  of  repair  in  any 
way,  and  they  had  a  difficulty  in  consequence  of  their  carelessness, 
they  are  responsible  for  it.  I  can  see,  on  the  other  hand,  where  it 
might  be  very  annoying,  especially  on  this  road  of  mine.  Three 
years  ago,  we  had  our  road  under  water  for  four  miles,  and  there  was 
some  trestlework  washed  away,  and  we  had  it  replaced  again.  We 
might  not  have  done  it  as  it  was  before,  but  that  would  give  the 
power  to  any  man  that  did  not  like  us,  whom  we  had  refused  to 
carry  over  the  road  for  nothing,  to  say,  "  Why,  this  structure  is  not 
built  as  it  was  before;  it  is  not  safe."  He  might  not  be  able  to 
maintain  a  complaint,  but  he  could  put  us  to  a  great  deal  of  trouble. 
It  might  not  be  as  good,  but  that  would  be  very  annoying.     We  have 


101 

now  our  track  running  to  Oroville,  and  a  depot  at  D  Street,  in 
Marysville.  The  depot  used  to  be  there.  We  have  an  old  depot 
there.  It  is  more  convenient  for  passengers,  coming  by  rail,  for  us 
to  go  to  the  city  for  them,  so  we  have,  a  depot  in  another  part  of 
the  city,  and  take  the  passengers  there.  This  old  depot  is  now  out 
of  repair,  and  to  be  compelled  to  repair  it,,  beyond  what  is  necessary 
for  keeping  our  engines  over  there,  would  be  needless  ;  but  I  think 
that  under  the  construction  of  this  statute,  we  would  have  to  keep 
that  in  good  repair.  We  intended  to  take  up  the  track,  and  run  it 
in  another  way,  so  as  to  connect  with  the  Central  Pacific  at  A  Street. 
We  have  a  track  running  there  for  a  mile,  which  ought  to  be  taken 
up,  but  we  can't  take  it  up  if  that  section  becomes  law.  It  would 
make  us  trouble.  The  people  do  not  demand  it.  It  don't  pay  the 
company,  and  we  should  not  be  compelled  to  keep  it  there.  Now,  at 
the  Honcut,  we  have  put  in  some  side  tracks,  running  out  to  differ- 
ent places  to  take  a  little  freight,  or  wood,  or  lumber.  We  might 
want  to  change  them,  and,  as  I  understand  that  section  three,  it 
prevents  it. 

Q.  What  amendment  would  you  suggest?  A.  I  would  suggest 
leaving  it  out  entirely. 

Q.  You  would  not  put  it  in  at  all?  A.  No;  I  don't  see  any  need  of 
it,  or  what  good  it  does. 

Senator  Spencer — Suppose  there  were  an  amendment  put  in 
there  to  meet  that  objection,  to  the  effect  that  it  should  not  apply  to 
side  tracks  or  temporary  structures?  A.  If  you  can  put  any  amend- 
ment in  there  that  will  not  compel  the  railroad  company  to  keep  the 
track  in  good  repair  when  there  is  no  necessity  for  it,  it  ought  to  be 
done,  but  I  have  not  heard  any  complaint  of  any  company  in  this 
State  not  keeping  their  track  in  repair  or  not  keeping  it  safe.  The 
very  first  thing  I  did  when  I  found  the  road  in  bad  condition  three 
years  ago  was  to  spend  a  large  amount  of  money  to  make  it  safe. 
There  is  no  railroad  company  that  would  keep  a  road  in  bad  repair. 
Self-interest  would  compel  them  to  keep  it  up  and  in  good  repair. 
It  will  only  make  an  annoyance  and  cause  trouble. 

Q.  You  have  heard  of  the  wharf  at  Santa  Monica?  A.  I  have 
heard  it  mentioned.     I  have  never  been  there. 

Q,.  Suppose  a  case  of  that  kind,  where  a  fine  structure  is  allowed  to 
go  to  decay  through  the  collusion  of  the  railroad  company.  Don't 
you  think  there  ought  to  be  some  law  that  would  prevent  a  wharf 
being  ruined  and  merchants  being  thereby  injured  and  trade 
depressed  ?     A.  Are  they  operating  a  road  there  and  running  freight? 

Q.  The  company  is  operating  a  road  from  Los  Angeles  to  Santa 
Monica.  A.  Mr.  Stubbs  knows  more  about  that  than  I  do.  Do  they 
use  this  wharf  for  transporting  freight? 

Senator  Del  Valle — They  don't  transport  freight  at  all.  A.  If 
the  railroad  company  are  running  freight  to  any  particular  wharf 
they  ought  to  keep  it  safe,  and  especially  as  there  is  a  danger  to  life, 
for  which  they  are  liable. 

Q.  Do  you  think  that  they  should  have  the  right  to  allow  a  struct- 
ure, such  as  a  wharf,  to  go  to  decay,  and  do  a  wrong  to  the  citizens 
of  a  place,  simply  because  they  desired  all  the  freight  to  go  by  rail? 


102 

Would  you  not  put  such  a  provision  into  the  law  of  our  State  as 
would  stop  such  things  from  being  done?  A.  If  I  could  do  so  with- 
out doing  more  injury  in  some  other  way.  You  must  take  these 
things  all  together.  If  you  could  not  put  this  section  three  in  as  it 
is  without  doing  greater  injustice  to  others,  I  say  let  the  wharf  stay 
as  it  is. 

Q.  I  am  asking  you  if  that  might  not  be  amended  so  as  to  meet 
this  objection?    A.  It  might  be. 

Q.  Suppose  that  there  was  a  provision  put  in  there  that  it  should 
not  refer  to  side  tracks,  or  temporary  structures,  or  anything  that 
occurred  from  the  act  of  God  ?  A.  A  fire  is  not  the  act  of  God  some- 
times, and  you  could  not  replace  it  again  as  it  was. 

Q.  Well,  we  will  say  any  certain  contingency?  A.  If  you  caD 
arrange  it  so  as  to  avoid  this  difficulty  it  should  be  done,  but  I  am 
of  the  opinion  that,  as  the  section  stands  now,  it  ought  to  be  taken 
out. 

Q.  Suppose  that  a  railroad  company  had  a  cause  of  complaint 
against  a  community,  and  would  remove  their  tracks  in  order  to 
injure  the  people  of  the  town.  Don't  you  think  there  ought  to  be 
something  in  the  law  of  the  land  to  prevent  them  from  doing  so? 
A.  I  think  so,  if  there  is  business  enough  in  the  town  to  pay  them 
for  running  a  railroad  there,  and  if  it  don't  pay  them  they  ought  to 
be  allowed  to  take  it  up. 

Q.  I  am  not  alluding  to  that  at  all ;  I  am  alluding  to  their  trying 
to  injure  the  people  of  a  town?  A.  I  don't  think  they  should  do 
that. 

Q.  Don't  you  think  there  ought  to  be  something  to  prevent  it 
being  done?  A.  Yes,  sir;,  and  I  think  you  could  do  that  without 
putting  that  section  in.  '  You  can  pass  a  law  to  prevent  them  from 
doing  that.  I  don't  think  the  railroad  company  ought  to  be  allowed 
to  discriminate  against  persons. 

Senator  Kellogg — Would  you  have  any  objection  to  section 
three  with  the  last  paragraph  left  out,  say  all  after  the  word 
"adopted,"  on  line  four,  if  it  is  the  intention  of  the  companies 
to  keep  their  roads  in  good  repair?  A.  They  must  do  so,  or  they 
can't  operate  them.  I  think  that  would  be  safe  enough.  Perhaps 
it  would  not  be  just  the  thing  for  my  road,  but  it  might  be  for  other 
roads.  Mine  cost  a  great  deal  of  money  to  build.  It  was  built  in 
an  early  day,  and  if  I  was  compelled  to  put  it  as  it  was  originally,  I 
could  not  do  it. 

Q.  This  does  not  refer  to  that  section.  You  must  keep  it  all  right 
to  the  freighting  points?     A.  I  suppose  that  .would  be  safe  enough. 

Q.  The  last  clause  is  what  you  make  objection  to?  A.  Yes,  sir;  I 
see  no  necessity  for  it. 

Q.  Now,  as  to  section  four?  A.  I  don't  know  as  I  have  anything 
to  say  about  that.  That  does  not  interest  me.  I  suppose  that  any 
road  that  has  a  charter  in  the  United  States  can  come  in  any  way. 
I  have  nothing  to  say  about  that.  It  may  retard  the  building  of 
roads,  and  might  retard  the  development  of  the  State,  and  injure 
the  people. 


103 

Senator  Sullivan — You  have  not  studied  that  proposition  at 
all?    A.  I  have  been  studying  only  these  propositions  that  affect  me. 

Q.  You  do  not  know  anything  about  foreign  corporations  at  all? 
A.  No ;  I  do  not  know  much  about  them.  I  am  not  a  lawyer..  I 
cannot  say  that  I  can  see  any  benefit  in  section  four. 

Senator  Cross — Do  you  know  what  section  five  relates  to?  A. 
It  relates  to  the  Political  Code. 

Q.  It  is  that  a  railroad  corporation  cannot  be  organized  to  exist 
for  more  than  fifty  years.  Now,  one  corporation  might  organize  in 
1850,  and  another  in  1860,  and  a  third  in  1870.  There  is  a  section  of 
the  Code  which  would  allow  these  three  corporations  to  consolidate. 
That  is,  a  provision  of  the  Code,  w7hich,  when  amended,  would  read 
so  that  whenever  the  first  charter  expired  then  the  rights  of  all 
would  expire.  A.  I  do  not  see  why  you  could  not  allow  them  all, 
when  joined  together,  to  run  as  long  as  the  youngest.  I  don't  see 
that  that  cuts  any  figure. 

Q.  It  don't  affect  you  ?  A.  No;  it  might  if  1  wanted  to  consoli- 
date. There  might  something  or  another  happen  that  another  road 
might  come  in  from  the  East  that  would  want  to  connect  with  us, 
but  if  these  things  were  put  in  the  way  it  would  be  that  much  against. 
If  that  is  done  I  do  not  see  how  the  Union  Pacific  could  ever  com- 
pete with  the  Central  Pacific  in  California. 

Q.  You  think  if  this  section  four  is  adopted  that  the  Union  Pacific 
could  never  build  a  competing  line  in  California?  A.  They  could 
build  under  a  new  incorporation.    They  could  not  connect  together. 

Q.  They  could  by  getting  a  charter  in  California?  A.  Yes,  they 
could  by  forming  two  corporations,  and  have  one  in  California,  run- 
ning to  the  State  line,  but  that  would  be  inconvenient,  and  it 
wouldn't  be  the  Union  Pacific.  (Reading  section  seven.)  Now,  I 
think,  of  course,  that  an  officer  or  agent  of  any  company  ought  to 
be  punished  for  disobeying  the  law,  and  I  think  that  section  ought 
to  be  amended  in  some  way  so  that  if  you  pass  a  law  it  will  punish 
the  parties  violating  the  law,  by  some  heavy  fine  or  something  of 
the  kind,  without  forfeiting  the  charter.  In  the  first  place,  to  forfeit 
the  charter  and  to  take  a  man's  property  as  against  a  mortgagee,  who 
is  an  innocent  party. 

Q.  The  author  of  the  bill  says  that  you  can.  He  claims  that  that 
is  the  effect  of  the  bill.  A.  You  might  pass  a  law  punishing  a  man 
for  doing  a  certain  thing,  but  you  cannot  confiscate  his  ranch  as 
against  a  mortgage.  If  I  put  a  mortgage  of  two  hundred  thousand 
dollars  on  a  railroad  and  borrow  the  monev  from  you,  and  a  certain 
agent  of  mine  violates  the  law  and  the  road  is  confiscated,  can  the 
State  take  the  property,  as  against  the  man  taking  the  mortgage,  and 
hold  it?  ' 

Q.  You  have  made  a  radical  error  in  that,  and  that  is  that  the 
road  never  belonged  to  you,  but  it  belonged  to  the  people.  The 
mortgage  belonged  to  the  wrong  man?  A.  Of  course  I  admit  that  if 
you  pass  a  law  you  want  a  penalty.  There  ought  to  be  a  penalty  to 
enforce  the  law.  All  laws  ought  to  be  enforced,  but  if  this  penalty  is 
put  on,  it  retards  the  development  of  the  country.  It  prevents  the 
building  of  new  railroads.     I  will  give  you  the  extent  of  my  experi- 


104 

ence,  and  it  is  this:  We  have  been  making  a  survey  this  last  Sum- 
mer up  the  Feather  River,  intending  to  extend  our  road  up  the 
North  Fork  of  the  Feather  River  to  Big  Meadows,  about  one  hun- 
dred miles.  We  have  surveyed  the  route,  and  the  engineer  has  been 
making  up  his  reports  and  maps,  and  about  two  weeks  ago  he  had  it 
finished.  The  gentleman  who  is  interested  along  with  me  is  quite 
wealthy,  and  he  proposed  to  put  up  the  money  for  this  road  and  to 
extend  it  if  possible,  and  we  were  to  have  a  meeting  in  San  Fran- 
cisco and  decide  whether  the  road  should  be  built,  and  take  the 
engineer's  figures  and  see  if  it  would  pay,  but  the  gentleman  says 
now:  "It  is  no  use  to  have  a  consultation  if  this  Barry  bill  is  to 
pass  with  that  section  in  it."  He  will  put  no  money  into  the  road, 
nor  he  can't  get  anybody  else  to  put  any  in.  He  could  not  incor- 
porate or  bond  the  road  for  the  cost  of  building  it.  Whether  the 
gentlemen  interested  with  him  took  the  bonds  or  not,  lie  would  not 
take  them  with  this  clause  in  the  bill.  I  say,  therefore,  that  that 
provision  will  prevent  any  capitalist  from  taking  any  bond  of  any 
railroad  in  California  for  the  building  of  a  local  road.  While  it  may 
not  be  constitutional  and  could  not  perhaps  be  enforced,  yet,  at  the 
same  time,  people  do  not  want  to  take  any  chances  about  those 
things.  I  think  that  this  clause,  with  the  forfeiture  attached,  would 
injure  railroad  building  in  this  State.  If  this  bill  does  not  forfeit  the 
charter,  then  of  course  it  has  no  effect,  but  if  it  does,  people  would  not 
put  money  into  them  (reading  section  six).  As  I  understand  it,  that 
takes  in  all  the  real  property  except  buildings.  Perhaps  it  does  not 
take  in  the  rolling  stock. 

Q.  Would  the  road  simply  be  the  right  of  way  ?    A.  No,  sir. 

Q.  The  rails  and  sleepers?  A.  I  should  say  the  rails  and  sleepers 
and  the  appurtenances. 

Q.  What  do  you  think  the  term  "  appurtenances  "  means?  A.  I 
think  it  means  the  ties  and  rails,  and  everything  required  to  run  the 
road. 

Senator  Sullivan — You  are  familiar,  no  doubt,  with  the  turn- 
pikes of  the  various  counties  of  California  ?  A.  I  used  to  be  in  early 
days,  but  not  lately. 

Q.  I  ask  you  as  a  matter  of  fact,  if,  when  the  grant  of  a-  turnpike 
has  expired,  it  does  not  become  a  public  highway?  A.  Unless  the 
parties  owning  the  turnpike  procured  the  right  of  way  from  the 
landholders  for  certain  purposes,  it  goes  back  to  the  original  land- 
holders. So  in  regard  to  a  railroad ;  I  suppose  it  goes  back  in  the 
same  way. 

Q.  I  only  ask  you  for  the  fact.  Do  not  these  turnpikes  become 
public  highways,  and  belong  to  the  people  of  the  State?  A.  I  sup- 
pose that  is  correct;  if  it  is  not,  it  ought  to  be. 

Q.  What  difference  is  there  between  a  turnpike  and  a  railroad? 
A.  A  turnpike  does  not  require  any  rails, .and  that  is  an  expensive 
matter,  besides  being  more  expensive  to  construct. 

Q.  Would  it  affect  your  opinion  any  if  you  knew  that  other  States 
have  a  similar  provision  and  their  railroads  were  carried  on  and 
made  a  success?  A.  I  don't  see  how  it  could  be  done  with  such  a 
law  as  this  in  force. 


105 

Q.  I  understand  that  in  several  of  the  States  like  this — or  of  the 
same  character — I  understand  there  is  such  a  law  in  Missouri,  and 
that  no  injury  has  been  done  to  the  interests  of  the  State  there  ?  A. 
If  there  is  a  law  like  this  in  Missouri,  that  allows  the  Stale  to  taKe 
the  property  of  a  corporation,  except  the  rolling  stock,  I  would  not 
like  to  loan  money  and  take  a  mortgage  on  the  road. 

Q.  What  would  you  suggest  in  the  way  of  a  penalty?  What  would 
be  a  fair  thing  between  the  railroad  and  the  people?  A.  That  is  a 
matter  that  is  difficult  to  answer.  It  seems  to  me  that  the  people 
make  laws  here  and  they  can  find  some  way  to  fix  a  penalty  and  have 
it  enforced.  If  imprisonment  were  too  severe,  you  might  tine  them 
so  much,  quite  a  large  amount  perhaps.  Possibly  the  railroad  might 
have  to  pay  it. 

Q.  Do  you  think  the  penalty  would  be  too  severe  upon  a  corpora- 
tion that  will  persistently  violate  the  law,  if  it  forfeits  its  charter?" 
I  am  not  speaking  of  little  matters  that  may  be  an  oversight — 
not  that  an  agent  might  do  this  or  that — but  suppose  that  a  corpora- 
tion, in  its  corporate  capacity,  by  the  voice  of  its  Directors,  persist- 
ently violate  the  law,  do  you  think  that  would  be  too  severe  a  penalty? 
A.  I  would,  for  the  reason  that  it  would  injure  innocent  parties.  I 
think  you  could  punish  the  company  in  some  other  way ;  I  don't 
think  you  should  confiscate  the  road.  I  think  you  could  punish  the 
party  who  commits  the  violation  without  confiscating  the  money 
that  I  may  have  in  a  mortgage.  That  section  six  might  be  boiled 
down  a  little  bit,  but  that  is  my  objection,  to  the  penalty. 
_  Senator  Cross — If  you  simply  forfeit  the  charter  under  that  sec- 
tion, do  you  understand  that  you  forfeit  the  right  of  way  and  the 
roadbed?  A.  If  you  forfeit  the  right  of  way  and  the  roadbed,  that 
would  be  all  that  belonged  to  the  people  of  the  State. 

Senator  Sullivan — Of  course,  the  privileges  granted  to  this  com- 
pany are  granted  by  the  people  of  the  State  for  the  benefit  of  the 
public,  and  when  the  corporation  violates  the  law,  the  public  are 
interested  in  the  matter,  and  can  forfeit  the  charter  and  the  roadbed 
and  right  of  way?  A.  I  suppose  that  would  be  an  injury  to  the- 
public. 

Q,  I  suppose  that  would*  incidentally  be  an  injury?  A.  When 
you  come  to  study  this  bill,  you  will  see  that  it  is  a  very  binding  bill. 

Q.  It  is  intended  to  be  binding?  A.  As  I  said,  I  do  not  object  to 
punishment,  but  I  think  those  two  sections  could  be  amended  so  that 
you  could  punish  the  managers  of  the  road  enough  to  prevent  them 
doing  these  things  without  confiscating  the  property.  You  might 
amend  it  so  as  to  punish  them  in  some  other  way,  without  taking  the 
property  away  from  the  parties  Who  hold  a  mortgage  on  it.  If  there 
was  no  mortgage  upon  the  road,  then  I  don't  know  but  1  should  pay 
the  penalty,  because  a  man  ought  to  be  very  careful  about  disobey- 
ing the  law.  I  think  it  will  operate  against  the  mortgagees  of  roads. 
I  think  the  Central  Pacific  Pail  road  Company  ought  to  be  punished 
if  they  disobey  the  law,  but  in  some  other  way.  I  would  not  retard 
the  interests  of  the  State  or  of  the  mortgagees  of  the  road. 

Senator  Sullivan — With  these  amendments  which  you  have 
suggested,  do  you  not  consider  this  a  good  bill  between  the  railroad 


106 

companies  and  the  people  of  the  State?  A.  Allowing  me  to  qualify 
those  parts  of  the  bill,  yes,  sir;  if  you  will  amend  section  one  and 
section  two  and  take  out  section  three. 

Q,.  You  did  not  strike  all  of  that  out?  A.  Well,  leave  out  part  of 
it;  and  really  section  one  and  section  two  is  about  all  there  is  of  the 
bill.  Section  one  is  in  regard  to  discrimination  between  persons,  as 
I  understand  it.     That  section  ought  to  be  amended. 

Q.  You  do  not  believe  in  forfeiture?  A.  No,  sir.  I  have  explained 
why. 

Q.  You  are  in  favor  of  a  penalty  sufficient  to  enforce  the  violation 
of  the  law?    A.  Of  course.     All  laws  ought  to  be  enforced. 

Q.  That  bill  would  not  be  worth  the  paper  upon  which  it  is  printed 
without  the  penalty?  A.  Unless  you  enforce  the  law  it  would  not  be 
worth  anything. 

Q.  Would  you  put  the  Directors  in  the  State  Prison  ?  A.  I  think 
that  would  be  better  than  to  take  the  property  from  the  stockholders. 
I  don't  see  why  you  cannot  punish  the  manager  of  a  railroad  com- 
pany as  well  as  you  can  the  manager  of  a  hotel.  You  put  a  penalty 
upon  the  manager  of  a  hotel  if  he  does  not  keep  a  certain  door 
swinging  in  a  certain  way;  and  you  impose  certain  laws  upon  differ- 
ent people.  I  don't  see  why  you  can't  put  a  different  punishment  on 
railroad  people  without  confiscating  the  property. 

Senator  McClure — I  want  to  ask  you  if  the  words  "other  struct- 
ures," in  the  first  sentence  of  that  section,  does  not  cover  the  very 
cause  that  you  spoke  of?  A.  I  supposed  at  first  that  if  I  didn't  keep 
those  structures  in  repair,  it  would  be  forfeited,  but  perhaps  not.  I 
am  opposed  to  the  whole  section,  but  it  would  be  better  than  it  is 
now  by  taking  out  that  clause,  "for  the  purposes  for  which  it  is  used." 
There  ought  to  be  no  objection  to  that. 

Q.  You  do  not  wish  it  to  be  understood  that  you  are  in  favor  of 
the  bill  at  all  under  any  circumstances?  A.  I  don't  know  whether 
I  ought  to  be  compelled  to  answer  such  a  question  as  that. 

The  Chairman — You  are  not  compelled  to  answer  any  questions. 
A.  I  will  simply  say  this,  in  a  general  way :  I  am  pretty  well 
acquainted  in  California,  and  have  business  connections  with  five  or 
six  different  kinds  of  business,  and  ship  grain,  etc.,  and  I  don't  know 
of  any  demand  on  the  part  of  the  people  for  this  bill.  I  don't  know 
a  man  in  Sacramento  that  says  he  wants  this  bill  passed.  Also,  in 
Marysville,  I  don't  know  of  a  man  in  the  city  of  five  or  six  thousand 
inhabitants  who  wants  it  done.  I  have-not  heard  anybody  say  they 
wanted  it  passed.  I  heard  people  say  they  didn't  want  it  passed. 
There  may  be  people  who  want  it  passed,  but  I  don't  know  of  any. 

Senator  Del  Valle — According  w  your  proposition,  those  amend- 
ments leave  the  matter  exactly  as  it  is  now?  A.  I  don't  know  as  it 
would  ;  but  if  the  bill  is  to  be  passed,  I  would  like  to  see  these 
amendments  in,  because  it  would  not  be  so  bad. 

Q.  Wouldn't  it  leave  it  almost  as  it  is  now?  A.  The  part  of  it 
discriminating  against  persons?  I  have  no  objections  to  passing  a 
law  preventing  discriminations  against  persons. 

Q.  You  suggested  that  tliey  should  be  allowed  to  discriminate 
in  classes  ?     A.  Yes,  sir. 


107 

Q.  Do  you  not  know  that  there  are  hundreds  of  classes  in  the 
classification  by  the  railroad  company  ?  A.  1  know  there  are  a  great 
many  ;  I  don't  know  just  how  many. 

Q.  Couldn't  they  to-day  discriminate  in  favor  of  grain  as  against 
iron,  for  instance,  and  to-morrow  discriminate  in  favor  of  iron  as 
against  grain  ?  A.  Yes  ;  but  you  should  put  in  an  amendment,  that 
they  should  not  discriminate  against  classes.  That  would  not  allow 
them  to  take  freight  of  one  class  as  against  another. 

Q.  To-day,  for  instance,  they  could  discriminate  in  favor  of  wheat 
and  against  barley  or  iron,  and  to-morrow  they  could  reverse  it  ?  A. 
With  that  amendment  in,  you  could  prevent  it. 

Q.  Therefore  the  conditions  would  be  just  the  same  as  they  are 
now?  A.  It  would  not  be  proper  for  them  to  do  it,  but  at  the  same 
time  I  think  you  could  allow  some  discrimination  to  the  managers 
of  the  road. 

Q.  Your  understanding  is,  that  with  your  amendment  in,  it  would 
be  just  the  same  as  it  is  now?  A.  No;  I  understand  now  that  they 
can  charge  one  man  more  than  another  if  they  want  to. 

Q.  I  mean  so  far  as  dispatching  freight  is  concerned  ?  A.  It  would 
be  as  it  is  now  in  regard  to  classes;  it  would  not  be  in  regard  to 
prices.  They  could  take  a  man's  ten  thousand  tons  in  preference  to 
the  other.  As  it  stands  now,  they  could  take  half  of  your  wheat  and 
half  of  mine,  but  with  this  law  they  would  have  to  take  all  of  yours 
and  none  of  mine. 

Q.  If  all  the  freight  was  of  the  same  class,  they  could  not  discrim- 
inate between  you  and  me?    A.  No,  sir. 

Q.  But  on  freight  of  different  kinds,  you  say  they  ought  to  be 
allowed  to  ?    A.  Yes,  sir.  % 

Q.  Then,  suppose  they  discriminate  to-day  in  favor  of  Class  A,  and 
to-morrow  in  favor  of  Class  B?     A.  You  don't  mean  in  prices? 

Q.  No ;  in  forwarding.  Could  they  not  do  so  under  your  amend- 
ment? A.  I  think  they  could,  but  at  the  same  time  I  don't  think 
that  any  railroad  company  would  be  foolish  enough  to  conduct  their 
business  in  that  way,  and  against  their  own  interest,  and  against  the 
interest  of  the  people.     I  don't  think  they  would  do  it. 

Q.  Supposing  that  you  had  a  difficulty  with  the  railroad  company, 
or  even  with  the  agent,  and  they  say,  "Here,  you  just  delay  this 
freight  as  much  as  you  can  ;  throw  any  obstacle  you  can  in  his 
way  ;  don't  you  think  that  such  things  would  be  done  ;  would  not  an 
amendment  in  a  case  of  that  kind  be  a  necessity  ?  A.  In  cases  of 
that  kind,  I  think  it  would. 

Senator  Kellogg — An  amendment,  to  the  effect  that  they  would 
be  required  to  give  five  or  ten  days  notice  of  any  change,  would 
save  all  that  trouble?  A.  I  don't  know  whether  it  would  or  not ;  it 
might. 

Senator  McClure — I  understood  you  to  say  that  if  such  a  case  did 
occur,  that  it  might  be  left  somewhat  to  the  managers  of  the  road? 
A.  Yes,  sir;  you  can't  pass  a  law  that  would  cover  every  particular 
case;  you  would  have  to  allow  a  little  power  to  the  managers  of  the 
road,  or  you  cannot  make  it  successful.  If  you  protect  the  interests 
of  the  people,  and  of  the  shippers,  and  the  railroad  company,   in 


108 

doing  so  you  may  have  to  put  some  clause  in  the  bill  allowing  the 
agents  of  the  company  to  discriminate  occasionally.  I  don't  see  how 
you  can  do  it  without. 

Q.  You  don't  consider  that  that  is  the  best  way  of  doing?  A. 
Yes,  sir,  I  do. 

Q.  You  have,  for  instance,  printed  Classes  A,  B,  C,  D  ;  you  change 
them  every  few  days;  or,  do  you  think  there  should  be  no  rule  at 
ail  ?  A.  I  think  they  ought  to  have  the  privilege  of  changing  the 
classes,  or  else  they  couldn't  manage  the  road. 

Q.  Therefore,  you  mean  that  it  should  be  left  just  the  same  as  it  is 
now  to  carry  on  the  business  with  discrimination  as  to  persons  only? 
A.  Yes,  sir. 

Q.  You  are  simply  opposed  to  any  portion  of  the  bill;  isn't  that 
the  exact  fact?  A.  Well,  that  is  pretty  near  it;  but  I  think  those 
amendments  would  affect  these  matters. 

Q.  Don't  those  amendments  contemplate  the  striking  out  of  one 
of  those  clauses?  A.  That  may  be  so;  I  say  if  that  bill  cannot  be 
amended  as  I  have  suggested,  it  ought  not  to  be  passed. 

Q.  You  believe  that  freight  should  be  dispatched  without  refer- 
ence to  who  is  the  owner  of  it?    A.  Yes,  sir. 

Q.  But  as  to  classes,  you  think  there  ought  to  be  allowed  some  dis- 
crimination; for  instance,  to  forward  furniture  before  ten  thousand 
tons  of  wheat?    A.  Exactly. 

Q.  Your  road  is  one  of  the  oldest  in  the  State?    A.  Yes,  sir. 

Senator  Cross — Do  you  know  anything  about  any  discrimination 
that  is  usually  made  with  regard  to  explosives,  or  powders,  or  any 
other  substances  of  that  character,  which  are  to  be  carried;  do  you 
know  whether  or  not  they#orward  those  cars  containing  explosives 
along  with  the  other  cars,  or  whether  they  have  special  days  for  for- 
warding that  class  of  freight?  A.  I  think  they  have  certain  days  to 
forward  them. 

Q.  And  they  carry  them  in  such  a  way  as  not  to  endanger  the 
safety  of  other  goods?    A.  I  understand  so. 

Q.  Do  you  think  that  such  a  discrimination  as  that  is  necessary 
for  the  protection  of  property?  A.  I  think  it  is  for  the  protection  of 
the  railroad  people.  They  are  responsible;  if  the  cars  are  blown  up, 
the  property  upon  the  same  cars  would  have  to  be  paid  for. 

Q.  They  "have  some  rule  about  sending  acids  and  that  class  of 
freight?     A.  I  think  so. 

Q.  Do  you  think  that  the  company  should  be  allowed  to  discrimi- 
nate as  to  when  they  should  forward  those  articles?     A.  Yes,  sir. 

Q.  You  think  that  they  should  be  allowed  to  classify  them  so  that 
they  may  carry  them  with  safety  to  the  property  of  other  people? 
A.  I  think  they  ought  to  be  allowed  to  discriminate  as  to  all  classes 
of  goods,  and  to  take  one  class  in  preference  to  another. 

Senator  Vrooman — Are  you  a  large  shipper?  A.  Yes,  sir;  I  am 
interested 

Q.  I  mean  over  these  roads?    A.  Yes,  sir. 

Q.  How  long  have  you  been  in  the  shipping  business?  A.  Twenty 
years. 

Q.  Has  there  ever  any  case  come  within  your  observation  of  per- 


109 

sonal  discrimination,  either  as  to  price  or  dispatch,  under  the  same 
circumstances?     A.  No,  sir. 

Q.  Have  you  ever  applied  to  the  Central  Pacific  Railroad  Company 
to  get  special  rates?    A.  Yes,  sir;  I  have  sometimes. 

Q.  Wanting  them  to  discriminate  in  your  favor?  A.  I  asked  them 
to  take  some  lumber  over  once  or  twice. 

Q.  Did  they  give  them  to  you?  A.  No,  sir;  they  told  me  if  they 
gave  it  to  me  they  would  have  to  give  it  to  all  at  the  same  price. 

Q.  In  fixing  the  price  of  goods  do  you  take  into  account  the 
value  of  the  goods  to  be  transported  to  a  certain  extent?  A.  Yes, 
sir;  we  take  into^consideration  the  value  of  our  lumber  to  the  mer- 
chants and  more  to  some  of  them. 

Q.  You  have  a  flouring  mill?     A.  Yes,  sir. 

Q.  And  you  make  different  grades  of  flour?     A.  Yes,  sir. 

Q.  Do  you  charge  more  for  one  grade  than  for  another?  A.  Yes, 
sir. 

Q.  Do  you  make  shorts?     A.  Yes,  sir. 

Q.  Do  you  charge  more  for  shorts  than  for  bran?    A.  Yes,  sir, 

Q.  Does  it  cost  you  any  more  to  make  it?  A.  No;  we  make  it  at 
the  same  time  that  we  make  the  flour. 

Q.  Do  you  conduct  your  railroad  upon  the  same  principle  that  you 
do  your  other  business?    A.  I  do  if  the  State  allows  me  to. 

Q.  I  will  call  your  attention  to  section  two,  commencing  at  line 
eight,  of  this  bill  (reading  it).  If  a  theater  man  came  to  you  and 
wanted  twenty-five,  or  thirty,  or  forty  tickets  for  his  company,  could 
you  give  him  a  rebate  under  this  law?  A.  I  should  suppose  that  we 
would  have  to  charge  the  same. 

Q.  You  could  not  call  them  commutation  tickets  for  a  single  trip? 
A.  No,  sir. 

Q.  Do  you  think  it  is  in  the  interest  of  the  patrons  of  railroads  that 
you  should  be  permitted  to  discriminate  and  make  a  rebate  in  cases 
of  that  kind,  where  a  large  number  of  persons  are  upon  an  excur- 
sion, or  wanted  to  go  at  one  time.  Don't  you  think  that  they  ought 
to  be  allowed  to  make  a  rebate  in  those  cases?  A.  We  do  it  some- 
times on  a  special  train ;  I  don't  know  as  it  is  a  rebate ;  we  take  them 
out  Sundays  and  charge  four  bits  apiece,  while  the  regular  trains 
are  a  dollar  and  a  half. 

•  Q.  Do  you  think  that  you  would  be  allowed  to  do  that  if  this  bill 
became  a  law?  A.  That  is  a  legal  question;  I  should  be  afraid  to 
do  it. 

Q.  Supposing  that  your  road  from  Marj'sville  to  Oroville  should 
cease  to  pay  operating  expenses,  and  become  useless,  do  you  think 
there  should  be  a  law  passed  that  would  prevent  you  from  removing 
it  without  sustaining  the  loss  of  your  charter?  A.  No,  sir;  I  do 
not. 

Q.  Would  you,  as  a  prudent  business  man,  attempt  to  remove  it 
under  section  three,  if  a  portion  of  your  road  ceased  to  pay?  A.  Of 
course  I  would  have  no  right  to  remove  it,  if  the  State  could  take 
the  rails  and  sell  them. 

Q.  Did  you  construct  this  road  yourself?     A.  No,  sir. 

Q.  Do  you   know  how  it  was   constructed  ?     A.  The   California 


110 

Northern  Railroad  Company  bonded  it  and  sold  the  bonds  and  built 
the  road. 

Q.  Do  you  know  who  paid  for  the  ties  and  the  rails  that  were  put 
down  ?  A.  The  company  paid  for  them,  and  obtained  the  money 
from  the  sale  of  bonds,  from  private  persons. 

Q.  Do  you  know  who  macadamizes  the  roads  in  your  county  ?  A. 
The  county  roads  are  macadamized  by  the  county. 

Q.  By  taxation  of  the  people?    A.  Yes,  sir. 

Q.  Do  you  think  there  is  any  similarity  between  the  county  roads, 
which  are  paid  for  by  taxation  of  the  people,  and  the  ties  and  rails 
of  your  road,  which  were  paid  for  by  the  company  r    A.  No,  sir. 

Q.  Do  you  think  any  law  is  just,  that  forfeits  to  the  people  of 
the  State  the  ties  and  rails  that  were  paid  for  by  private  persons, 
because  a  forfeiture  is  worked  upon  a  road  paid  for  by  the  public? 
A.  No,  sir  ;  I  don't  think  it  would  be  just. 

Senator  Sullivan — Who  pays  for  the  macadamizing  of  any  turn- 
pike road  that  you  know  of  in  this  State  ?  A.  Do  you  mean  a  private 
road,  owned  by  a  corporation  ? 

Q,.  Yes,  sir?    A.  The  people  that  own  the  roads. 

Q.  They  collect  toll,  do  they  not?  A.  Yes,  sir;  where  they  own 
the  road. 

Q.  Supposing  that  they  did  something  to  forfeit  their  roads ;  do  you 
not  think,  then,  that  the  people  of  the  State  would  have  the  right  to 
take  the  road  as  a  public  highway  ?  A.  They  should  either  forfeit  it 
or  be  punished  in  some  other  way. 

Q.  Do  you  not  think  that  any  railroad  company  who  holds  prop- 
erty in  the  same  manner  should  have  their  charter  forfeited  if  they 
violated  the  law?  A.  I  stated  before  that  I  did  not,  for  the  reason 
that  I  thought  they  should  be  punished  in  some  other  way. 


Testimony  of  A.  E.  Davis,  of  San  Francisco. 

Senator  McClure — I  wish  you  to  take  this  bill  and  make  any 
suggestion;  first,  as  to  the  railroad  you  are  interested  in?  Answer — 
The  South  Pacific  Coast  Railroad. 

Q.  What  relations  do  you  bear  to  that  road  ?  A.  President  and 
part  owner. 

Q.  How  long  has  that  road  been  in  operation  ?  A.  The  Southern 
Pacific  Coast  Railroad  was  commenced  at  the  terminus  on  the  first 
day  of  April,  eight  years  ago. 

Q.  Between  what  points  are  the  termini  ?  A.  San  Francisco  and 
Alameda  Point  by  ferry,  and  thence  by  rail  through  Alameda  and 
Santa  Clara,  and  across  the  Santa  Cruz  Mountains  to  the  Town  of 
Santa  Cruz,  in  Santa  Cruz  County. 

Q.  The  road  is  projected  beyond  that?  A.  We  have  many  projec- 
tions beyond  that;  but  no  work  so  far,  except  in  the  way  of  surveys. 
Nothing  of  any  particular  importance  except  a  branch.  We  are  con- 
structing, or  rather  have  made  a  survey,  for  a  branch  from  the  old 
town  of  Felton  to  Pescadero  by  the  San  Lorenzo  River,  and  through 


Ill 

the  redwood  country.  We  have  also  a  survey  completed  from  our 
terminal  point  at  Alameda  now,  where  we  have  a  new  route  to  Stock- 
ton. The  survey  is  completed,  and  the  profiles  are  in  the  office,  but 
the  work  of  action  has  been  suspended. 

Q.  You  are  a  part  owner  ?    A.  Yes,  sir. 

Q.  Has  this  railroad  been  constructed  by  subsidies  or  by  private 
capital?    A.  By  private  capital  entirely. 

Q.  You  have  never  received  any  subsidy  from  the  General  or  State 
Government?  A.  In  no  shape  whatever.  No  State,  county,  town, 
or  individual. 

Q.  Of  course,  if  you  have  any  objection  to  answer  these  questions 
you  have  only  to  say  so.  About  how  much  money  have  you  invested 
up  to  this  time  in  those  roads?  A.  If  the  Assessor  wasn't  about  I 
would  be  more  willing  to  tell  you.  I  admit,  however,  that  I  have 
paid  more  than  it  is  worth. 

Q.  There  has  been  a  large  sum  of  money  expended?  A.  Yes,  sir; 
over  four  millions. 

Q.  Now  will  you  please  take  Assembb7,  Bill  No.  10  and  make  any 
suggestion  to  this  committee,  commencing  with  section  one,  as  to  the 
provisions  of  the  bill,  with  reference  to  the  operations  of  your  rail- 
road? A.  I  scarcely  flatter  myself  that  I  can  give  this  committee 
any  information.  I  am  willing,  however,  to  endeavor  to  try,  if  I 
am  allowed  to  state  in  my  own  way.  I  am  no  lawyer  or  legislator. 
If  there  is  anything  about  me  it  is  a  practical  way  of  putting  it.  If 
I  was  asked  what  I  thought  of  this  bill,  I  should  say,  if  I  was  asked 
how  I  would  amend  this  bill,  I  should  say  by  striking  out  the  enact- 
ing clause.  If  I  was  asked,  "What  for?"  I  should  simply  answer: 
"Because,  in  my  judgment,,  the  character  of  such  legislation  is  med- 
dlesome and  pernicious."  "Why?"  "Because  it  is  calculated  to  do 
a  great  deal  of  harm  without  doing  any  commensurate  good  that 
I  can  see."  So  much  for  that.  Now,  commencing  at  the  first  section, 
I  read:  "All  railroads  built  or  owned  by  corporations,  or  organized 
under  the  laws  of  the  State,  are  public  highways,  over  which  all  per- 
sons are  entitled  to  transportation  for  persons  and  property  on  equal 
and  impartial  terms."  I  should  add  to  that,  if  I  was  asked  to  amend 
the  bill,  "according  to  the  services  rendered."  That  might  help  that 
to  some  extent.  (Reading.)  "All  persons  and  companies  engaged 
in  operating  any  such  road,  or  in  transporting  freight  or  passengers 
over  the  same,  or  which  shall  hereafter  operate  or  engage,  as  afore- 
said, shall  forward,  move,  and  carry,  impartially,  for  all  persons 
offering  freighf  to  be  transported  or  moved,  without  discrimination." 
Now,  there  is  the  plum  of  the  whole  business.  I  should  say  that  that 
cannot  be  done.  I  undertake  to  say  so,  and  I  undertake  to  say,  and 
I  would  not  state  an  unfair  proposition,  either  in  my  own  favor  or 
ortherwise.  That  is  the  pith  of  the  whole  business,  "without  dis- 
crimination." Now,  gentlemen,  that  word  "discrimination;'"  it 
makes  a  great  deal  of  difference  whom  that  word  is  applied  to,  doesn't 
it?  If  you  discriminate  in  favor  of  a  shipper  it  is  all  right.  If  you 
discriminate  in  favor  of  yourself  it  is  all  wrong,  isn't  it?  Isn't  the 
true  proposition  whether  I  shall  discriminate  either  against  you  or 
in  your  favor,  as  you  please?    Now,  I  say  that  in  running  this  road 


112 

of  ours,  constructed  as  I  stated,  and  operated  entirely  in  the  interest 
of  the  people,  and  to  the  best  of  our  ability  to  do  so,  we  discriminate 
every  day;  badly,  too.  But  I  do  it  in  favor  of  my  patrons.  I  don't 
hesitate  to  say  so.  I  may  be  in  fault,  for  what  I  know,  but  I  am 
not  aware  that  I  am.  I  will  illustrate,  and  give  you  examples,  if 
you  desire  to  hear  them,  of  how  it  occurs. 

Senator  Cross — We  want  to  get  facts,  if  there  is  any  good  reason 
for  them,  and  if  there  is  not  we  want  to  know  it.  A..  My  patrons 
say  that  there  is,  and  I  venture  to  say  that  on  my  road,  six  miles 
long,  every  patron  I  had  would  have  as  good  a  reason.  Our  road,  of 
course,  is  short,  and  it  is  chiefly  for  its  travel  we  depend  for  Summer 
patronage  for  any  returns  that  amount  to  anything  considerable. 
Our  business  travel  amounts  to  very  little.  We  discriminate,  if  you 
please,  in  favor  of  all  sorts  of  societies.  We  do  that  in  order  to 
meet  them  at  a  price  they  can  pay;  that  is  to  say,  we  increase  our 
resources  as  much  as  possible,  but  we  discriminate  in  freights  too 
every  day.  I  will  tell  you  why.  I  know  the  propriety  of  it  under 
very  close  reasoning  might  be  doubted,  but  that  is  all  right.  The 
upper  end  of  our  railroad  runs  through  a  redwood  country.  One  of 
our  chief  resources  for  business  is  in  the  shape  of  lumber  and  wood. 
Now  it  runs  to  the  Town  of  San  Jose,  which  is  a  large  consumer  of 
redwood  lumber,  several  million  feet  of  lumber  every  year — eight  or 
ten  probably — and  before  the  construction  of  this  road  the  common 
freight  over  the  mountains  was  seven  or  eight  dollars  per  thousand. 
As  a  result  of  the  building  of  this  road,  it  was  to  reduce  that  freight 
to  four  dollars,  which  I  believe,  as  far  as  I  have  heard,  is  entirely 
satisfactory  to  the  consumers,  and  I  know  it  is  to  the  shippers;  I  am 
certain  of  that.  And  like  all  other  things  of  that  character  it  stim- 
ulated the  building  of  a  great  many  sawmills,  and  it  increased  the 
price  of  timber  lands  from  five  to  forty  dollars  an  acre;  and  in- 
creased in  the  production  of  lumber;  they  found  they  were  producing 
more  lumber  than  they  could  sell,  and  the  lumber  people  came  to 
me  and  said,  ''We  desire  you  to  give  us  relief,  if  you  can."  I  said, 
"What  relief  do  you  require?"  ''Open  up  further  markets  for  us." 
"How?"  "Send  our  lumber  into  Alameda  County."  They  never 
had  that  market  before. 

Senator  Cross — How  much  further  would  that  be?  A.  About 
forty  miles  by  rail;  but  they  say,  "You  must  carry  it  very  cheap." 
"Why?"  "Because  they  have  got  redwood  lumber  in  Mendocino 
County,  and  there  were  water,  and  ships,  and  boats  between  Mendo- 
cino County  and  the  Bay  of  San  Francisco."  I  said,  '*!  will  see  how 
I  can  serve  you,  and  I  will  serve  you  if  I  can."  I  concluded  I  would 
make  myself  believe  that  if  I  could  haul  sixteen  millions  of  lumber 
through  the  expensive  part  of  the  road,  through  the  tunnels,  and  to 
San  Jose,  at  four  dollars,  it  would  be  better  than  to  haul  eight  mil- 
lions, so  I  agreed  with  my  shippers  that  I  would  carry  the  lumber 
the  other  forty  miles  for  a  half  a  dollar  a  thousand,  because  they  say, 
"  If  you  charge  us  eight  dollars,  we  can't  sell  any  lumber.  The  Men- 
docino fellows  sell  it  all."  Now,  I  say,  if  that  is  not  discrimination 
between  places,  I  do  not  know  what  it  is.  Is  it  right?  Am  I  doing 
wrong,  and  should  it  all  cease?    I  was,  certainly,  if  I  know  or  under- 


113 

stand  the  reading  of  that  bill.  I  apprehend,  if  the  delegation  here 
from  those  counties  could  hear  their  constituents,  they  would  not 
wish  to  stop  it.  I  think  they  would  not,  but,  to  my  mind,  that 
is  the  result  of  the  word  "  discrimination,"  in  section  one,  line 
nine,  in  this  bill.  That  would  be  the  practical  result  of  it.  Now 
I  can  say  no  more  upon  that,  that  is  the  fact.  I  can't  say  anything 
more  on  that  section.  That  is  all  there  is  about  it,  and  that  is  the 
word  "discrimination"  here.  It  happens  here  to  be  in  favor  of  the 
people.  I  hope  I  shall  not  lose  anything  by  it.  I  don't  know  that  I 
have.  I  am  very  certain  that  I  don't  make  anything  by  it.  I  know 
I  help  them  all  1  possibly  can  myself,  and  give  them  the  best  end  of 
it.  I  would  like  to  make  one  other  application  here  that  applies  to 
the  discrimination  that  is  practiced.  I  was  about  to  make  a  con- 
tract with  a  lot  of  gentlemen  who  contemplate  constructing  a  sugar 
manufactory  at  Alvarado,  in  the  County  of  Alameda,  twenty-five 
miles  from  San  Francisco.  A  delegation  of  gentlemen  waited  on  me, 
including  the  proprietors  of  the  beet  sugar  manufactory.  We  have 
only  one  in  the  State  that  I  know  of,  and  that  is  this  one  of  ours,  that 
is  successful.  We  have  found  it  extremely  difficult  to  get  into  the 
manufacturing  of  beet  sugar.  They  wanted  to  connect  their  business 
with  the  cane  sugar.  They  sent  an  agent  to  the  Sandwich  Islands  to 
contract  with  several  planters  there  who  are  producing  large  amounts 
of  cane  sugar.  They  were  looking  anxiously  for  a  favorite  location 
for  their  manufactory.  They  came  to  me  and  said,  "  Mr.  Davis,  what 
can  you  do  for  us?"  "Well,  I  don't  know;  I  am  willing  to  do  any- 
thing I  can."  I  have  expended  a  great  deal  of  money  in  railroad- 
ing here,  and  I  have  never  been  able  to  make  anything  out  of 
it  yet.  Although  our  gross  receipts  last  }7ear  were  nine  thousand 
dollars  a  mile  it  did  not  meet  our  expenses.  Our  payroll  was 
twenty-three  thousand  dollars  a  month.  If  my  lines  were  longer 
I  should  expect  to  receive  more.  Of  course,  my  terminal  facilities 
would  be  just  as  good  for  one  thousand  or  two  thousand  miles  as  it 
is  for  one  hundred  miles.  Now,  I  said,  "What  do  you  want  me  to 
do?"  "We  want  you  to  enable  us  to  compete  with  Glaus  Spreckles." 
I  said,  "That  is  a  pretty  tough  job  to  do,  but  I  will  do  the  best  I  can 
for  you.  State  your  proposition."  "We  want  you — we  have  offered 
us  five  acres  of  land,  located  at  Alvarado,  and  we  want  you  to  stand 
in  and  help  us;  we  think  it  would  be  to  your  interest — we  know  it 
would.  We  want  you  to  carry  our  crude  sugar  from  your  wharf 
at  San  Francisco,  and  ferry  it  across  to  your  new  mole  on  the 
Alameda  side  of  San  Francisco  Bay,  and  cany  it  to  Alvarado, 
at  fifty  cents  a  ton.  We  want  you  to  bring  back  our  refined 
sugar  and  deliver  it  on  your  terminal  wharf  at  San  Francisco  at 
fifty  cents  per  ton.  We  want  you  to  handle  all  our  coal  from  your 
new  wharf  at  fifty  cents  a  ton,  and  no  wharfage,  either."  "  Well,"  I 
says,  "  That  is  a  pretty  tight  proposition  ;  I  hardly  see  what  there  is 
in  that  for  me;  I  don't  see  how  I  can  make  any  •money  out  of  that." 
They  said,  "Yes,  you  can,  you  don't  understand  this  thing."  "Well, 
please  to  show  me,  if  I  don't."  They  said,  "You  know,  if  we  open  a 
refinery  up  there,  there  will  be  at  least  one  hundred  people  go  there 
to  operate  it,  and  they  will  start  coal  yards,  grocery  stores,  etc.,  and 


114 

they  will  make  a  flourishing  town,  and  you  will  benefit  the  people, 
and  you  will  get  the  benefit  of  all  the  freights  upon  which  you  can 
charge  freight,  and  make  money."  "Well,"  I  said,  "It  does  look 
plausible,  and  I  will  consider  it."  I  went  off  and  thought  about  the 
matter.  I  told  them  if  they  would  call  around  in  a  day  or  two,  I 
would  consider  it  and  let  them  know.  I  studied  over  the  matter  and 
went  back,  and  said,  "Gentlemen,  I  would  like  to  make  it  for  you, 
but  it  is  pretty  hard  work  for  me  to  make  land  as  valuable  in  Alva- 
rado  as  it  is  in  San  Francisco,  but  I  would  like  to  accomplish  it,  if  it 
was  possible;  I  will  do  it  for  you  for  sixty-five  cents."  They  said, 
"No,  we  can't  do  it;  you  must  do  it  for  fifty  cents  a  ton;  you  will 
make  it  back  in  the  increase  of  your  busines  that  you  will  do."  I 
didn't  have  the  Barry  bill  in  my  mind  just  then,  and  I  finally 
said,  "In  order  to  accomplish  it  I  will  tell  you  what  I  will  do:  I 
will  carry  it  for  sixty-five  cents,  bearing  in  mind  all  the  time  that  I 
would  charge  the  other  fellowrs  something — the  coal  yard  man,  and  the 
groceryman.  I  made  them  that  proposition  which  they  are  now  con- 
sidering, to  give  them  a  five  years'  contract  to  do  that,  but  in  the  mean- 
time somebody  sent  me  down  the  Barry  bill,  and  I  began  to  study  the 
Barry  bill.  I  says,  "  Here,  why  that  goes  to  the  coal  yard,  and  the 
groceryman,  and  all.  Every  fellow  will  want  his  stuff  carried  at 
the  same  rate.  How  am  I  going  to  do  that?  And  I  can't  do  it, 
because  I  cannot  discriminate  between  persons  and  places."  Now,  if 
that  is  the  fact  and  the  conditions,  I  am  opposed  to  the  Barry  bill 
and  anything  that  is  in  it.  If  you  can  tell  me  any  good  way  that  I 
can  carry  out  that  enterprise  without  running  against  that  law,  I 
would  like  to  know  it;  I  can't  see  bowr  it  can  be  done.  I  can't  see 
what  good  the  bill  does  anybody.  I  might  do  these  people  some 
good.  The  factory  might  do  the  people  some  good  ;  it  might  increase 
the  volume  of  my  business,  so  that  I  would  be  able  to  get  a  portion 
of  my  money  back  that  I  have  put  into  railroads.  And  am  I  to  be 
deprived  of  that?  I  come  here  to  this  Legislature — I  think  this  is 
the  most  remarkable  instance  on  record — asking  this  Legislature  to 
please  let  me  alone  because  I  was  fool  enough  to  put  my  money  into 
a  railroad.  That  is  the  practical  sum  of  it;  it  is  nothing  more  or  less. 
If  you  will  pardon  the  expression  of  my  mind,  it  seems  to  me  that 
all  I  have  learned  in  eight  years  is  this:  That  I  have  got  into  the  wrong 
business;  that  an  honest  man»can't  live  in  it;  that  a  railroad  is  not 
worth  anything  unless  you  can  steal  it.  I  can't  do  that,  but  the  fellow 
that  can  is  the  fellow  to  run  it.  That  is  a  pretty  hard  experience,  isn't 
it?  And  that  is  so  much  for  discrimination.  I  think  that  is  plenty 
to  say  of  it.  I  don't  know  what  more  I  could  say  if  I  talked  a  week. 
If  there  is  any  crime  on  the  part  of  the  railroad  people  of  this  State, 
please  not  visit  their  sins  on  me.  I  don't  know  that  there  is.  I  think 
there  is  more  talk  about  it  than  there  is  reality  in  it,  although  I 
think,  if  I  might  venture  an  opinion,  if  I  had  had  the  system  of 
railroads  of  the  Central  Pacific  Railroad  and  the  Southern  Pacific 
Railroad,  I  would  guarantee  that  I  would  not  have  had  much  mone3r. 
But  that  is  a  question  between  the  people  and  them  as  to  who  is  to 
get  it  all.  I  don't  want  it  all.  It  is  too  much  trouble  to  me,  I  want 
somebody  else  to  have  some  of  it.     The  fact  is  that  there  are  just  the 


115 

same  difficulties  in  every  branch  of  life.  I  saw  my  friend  Webster 
here  with  his  bank;  be  loans  money  for  less  than  Michael  Reese;  I 
only  say  that  as  an  illustration;  it  is  the  difference  between  men; 
everybody  and  every  interest  ought  to  be  put  on  a  plain,  fair  footing; 
and  these  are  simply  my  practical  suggestions.  If  there  was  some 
man  in  this  State  who  could  get  hold  of  the  right  end  of  this  puzzle 
and  eliminate  it  to  the  satisfaction  of  everybody,  he  would  be  called 
a  very  big  man.  There  are  difficulties  here  to  my  mind  almost 
impossible  to  overcome.  I  cannot  believe,  to  start  out  with,  after 
buying  as  I  did  a  right  of  way  through  three  counties,  and  I  never 
invoked  the  right  of  eminent  domain  only  in  three  instances — 
one  in  each  county — in  most  instances  I  took  a  deed  in  fee;  I 
had  to  pay  for  the  land  in  all  cases  by  private  agreement,  or 
by  arbitration.  I  didn't  have  any  suits  where  it  was  possible 
to  avoid  them;  and  it  seems  to  me  that  while  all  the  world 
is  building  new  roads  under  the  law  as  it  now  stands,  the 
new  Constitution,  and  the  correlative  legislation  under  it,  and 
that  which  is  proposed  to  be  made,  that  it  is  almost  impossible  to 
build  a  railroad  in  this  State.  But  I  bought  this  land,  and  I  paid  for 
it  clean.  Some  of  it  I  bought  directly  in  the  name  of  the  South 
Pacific  Coast  Railroad  Company;  or  rather,  I  might  state,  that  we 
have  three  or  four  corporations;  I  got  it  originally  for  the  South 
Pacific  Coast  Railroad  Company,  starting  from  Dumbarton  Point 
on  the  Bay  of  San  Francisco,  and  running  through  Santa  Cruz,  and 
through  the  upper  end  of  Alameda  County,  but  I  found  that  it  was 
impossible  to  do  anything  with  that,  that  I  would  never  do  anything 
at  all  with  it  till  I  put  in  new  money  and  built  new  lines,  and  made 
new  incorporations  under  the  control  of  the  same  stockholders  and 
the  same  President,  excepting  that  we  made  a  nominal  change  in  the 
Trustees,  but  none  of  the  Trustees  are  owners  except  one  and  myself. 
It  was  easier  to  make  new  incorporations  than  to  amend  the  old  ones. 
We  thought  we  would  call  it  the  South  Pacific  Coast  Railroad  Com- 
pany, as  I  said,  starting  from  Dumbarton  Point  and  running  to  the 
junction  of  the  Santa  Cruz  and  Fulton  Railroad,  and  which  we  after- 
wards bought.  That  is  about  seven  miles  in  length;  it  terminates  at 
the  junction,  a  little  below  Big  Trees — the  Felton  Big  Trees.  We 
maintain  that  corporation  still,  and  maintain  and  operate  the  road, 
and  call  it  the  South  Pacific  Coast  Railroad  Company.  Then  we 
have  what  we  call  the  Bay  Coast  Railway,  and  a  third  line  running 
from  Newark,  in  Alameda  County,  down  Alameda  Point  down  to  the 
middle  bridge,  at  Oakland,  that  is  the  end  of  that.  After  building  that 
we  found  that  we  had  not  enough  to  do  yet,  to  do  anything,  so  we 
thought  we  would  run  into  Oakland,  and  we  got  in  there  ;  but  I  don't 
want  to  try  it  over  again.  We  quit  in  Oakland  at  Fourteenth  and 
Webster  Streets.  Now,  we  need  another  corporation,  which  we  have 
just  made,  that  we  call  the  Felton  and  Pescadero ;  that  is  the  one 
that  I  spoke  of.  We  have  the  surveys  made,  and  are  now  trying  to 
procure  the  right  of  way,  and  would  probably  have  begun  the  con- 
struction of  it  the  coming  Spring.  Then,  we  have  another  incorpo- 
ration—the last — which  is  the  largest  one  of  all;  that  is  the  San 
Francisco  and  Colorado  River.     That  is  the  one  we  have  got  in  our 


116 

minds.  That  is  several  hundred  miles  long;  that  is,  the  papers  are, 
but  that  is  like  a  good  many  others — a  good  deal  of  paper  about  it. 
We  have  built  our  new  mole  and  new  depot  under  the  incorporation. 
The  line  was  not  covered  by  any  previous  surveys.  We  hope,  if 
railroad  matters  turn  more  favorably,  that  we  will  be  able  some  time 
to  build  that  road.  I  don't  know  whether  we  will  be  able  or  not,  but 
I  am  sure  I  cannot  if  this  legislation  is  carried  on.  I  mean  to  say  if 
the  promoters  and  sponsors  of  this  legislation,  believing,  as  I  believe 
they  do  believe,  that  it  is  right.  I  think  they  are  prejudiced,  to  say 
the  least.  I  don't  think  there  is  one  of  them  that  is  prejudiced 
against  or  would  do  me  any  harm  as  far  as  I  am  concerned,  in  any 
way;  I  don't  think  they  would.  But  I  will  say:  Suppose  that  I 
(being  the  one  honest  man  in  the  railroad  business) — that  I 
should  come  here  and  say:  "Gentlemen,  I  will  stand  in  with 
you ;  we  will  adopt  the  Barry  bill  ;  I  have  lost  more  than  I 
can  afford  ;  now  we  will  steal  more  than  my  profits  could  aggregate 
in  a  hundred  years.  I  will  show  you  how  to  do  it  under  this  Barry 
bill;  it  is  very  easy.  I  don't  think  you  ought  to  give  me  or  any 
other  man  the  power  to  do  it.  But  say  everything  is  lovely,  the  leg- 
islation all  suits  me,  and  I  will  stand  in  with  all  you  people,  I  am 
not  going  to  contend  with  you  about  property  or  property  rights; 
that  is  all  nonsense;  I  don't  care  anything  about  it.  I  build  my 
railroads,  say  some  three  hundred  miles.  I  have  a  fair  standing  and 
credit.  As  I  said,  we  have  never  had  a  mortgage  upon  our  roads;  it 
was  built  and  paid  for  with  good  sound  gold  coin  ;  I  think  the  stock- 
holders could  very  easily  manage  that  part  of  it,  if  we  desired.  We 
say  we  will  organize  now  with  this  three  hundred  miles  of  road.  I 
go  out  in  San  Francisco,  or  go  down  to  San  Jose ;  I  have  my  Senator 
in  San  Jose,  reputed  to  be  a  man  of  wealth.  I  say  to  him:  "I  have 
some  railroad  bonds  to  sell;  you  know  me;  you  know  what  I  have 
done;  you  know  that  further  roads  will  be  a  benefit  to  you,  because 
you  have  a  large  property  here,  and  I  ask  you  to  take  about  twenty 
thousand  dollars'  worth  of  these  railroad  bonds;  they  are  all  right." 
He  finally  starts  out  and  looks  it  over,  and  he  says:  "I  think  I  will 
take  them."  I  go  on  to  various  capitalists,  and  I  finally  raise  enough 
by  this  sensible  way  of  doing  business,  to  build  a  road  with  some- 
body else's  money,  and  after  I  had  built  the  road  I  would  say,  under 
the  Barry  bill  and  kindred  legislation  like  this,  I  would  say:  "Never 
mind  your  bonds;  I  will  kick  up  some  deviltry  now  and  you  will 
sell  the  bonds  for  half  what  they  are  worth,  because  I  will  frighten 
you."  I  say  that  it  is  quite  in  my  power  to  do  it,  or  of  any  other  man. 
I  am  learning  something  new  about  the  railroad  business  every  day  ; 
I  am  very  sure  I  shall  learn  more  about  it.  Now,  I  don't  believe 
myself  that  the  provisions  of  the  bill  could  ever  be  carried  out, 
because  I  don't  believe,  from  what  I  have  observed,  that  if  we  found 
our  property  taken  to  pay  the  taxes,  and  the  next  fellow  took  it,  and 
because  he  didn't  pay  the  taxes  it  would  be  sold  again,  I  don't  know 
where  we  would  catch  it,  it  would  be  running  round  so.  It  would 
depress  the  value  of  the  bonds  so  that  any  designing  man  could  buy 
them  up  at  his  own  price.  I  don't  know  what  good  that  would  do 
anybody.     It  might  be  denied  that  it  could  be  done,  but  I  believe  it 


117 

can.  I  am  not  a  lawyer,  but  I  believe  if  that  bill  is  carried,  just  as 
these  men  here  propose  to  pass  it,  that  it  could  be  done.  Now,  there 
is  only  one  other  thing  to  say:  You  say  that  it  is  necessary  to 
declare  in  all  solemnity,  to  the  assembled  wisdom  of  this  State,  that 
no  railroad  shall  come  into  this  State  without  incorporating  in  the 
State.  Now,  if  there  is  anything  in  that,  I  declare  I  don't  see  it.  I 
say  that  the  power  of  the  State  has  jurisdiction  over  the  State  in  a 
paternal  and  parental  way.  The  laws  ought  to  be  made  and  main- 
tained and  obeyed  ;  and  though  they  ought  to  be  and  will  be  obeyed, 
yet  I  say  there  is  no  wealth  for  the  people  of  this  State,  excepting  in 
the  encouraging  of  roads.  The  people  of  this  State  cannot  afford  to 
cast  out  all  its  securities — they  want  more  roads.  If  there  was  any- 
body in  this  State  that  could  devise  means  by  which  we  could  get 
more  roads,  and  make  those  that  are  here  do  right  constitutionally, 
I  have  no  objections.  I  know  very  well  that,  so  far  as  I  am  con- 
cerned, or  anybody  associated  with  me,  we  do  not  wish  any  more. 
We  will  not  sink  new  money,  or  put  it  into  undesirable  securities; 
it  is  unreasonable  to  suppose  that  any  sensible  man  would  do  so. 
•That  is  all  I  have  to  say. 

Q.  What  is  the  name  of  your  road  ?  A.  The  San  Francisco  and 
Colorado  River. 

Q.  Projected  from  what  point?  A.  The  survey  commenced  at  our 
terminal  point  in  San  Francisco  Bay,  a  little  south  of  the  estuary  of 
San  Antonio,  and  adjoining  the  front  wall,  and  follows  up  that  and 
over  to  the  Marin  coast,  and  crosses  and  takes  up  the  valley  there. 

Q.  If  this  bill  becomes  law.  will  that  road  be  built?  A.  Not  by 
me;  I  will  not  try  it.  I  can't  do  it  myself,  and  I  can't  get  the  money 
to  do  it  with  if  I  desired  ever  so  much  ;  and  I  would  not  advise  a 
friend  of  mine  to  put  it  into  it.  This  may  be  considered  a  remark- 
able statement  for  a  man  who  is  a  railroad  man  to  tell.  Most  people 
are  bolstering  up  their  things,  but  I  declare  that  that  is  the  naked 
truth. 

Senator  Kellogg — You  bought  the  land  and  right  of  way  in  fee. 
Do  you  own  that  ?  A.  I  don't  know  that  I  made  that  entirely 
clear.  We  have  what  we  call  a  sister  corporation  with  our  railroad 
corporation  ;  that  is  not  exactly  au  fait  in  that  line  ;  it  buys  and  pays 
for  all  it  gets;  it  don't  build  any  railroad;  we  call  it  the  Pacific 
Land  Investment  Company.  In  various  places  we  have  had  to  buy 
considerable  tracts  of  land  in  order  to  get  the  land  we  traversed.  If 
we  couldn't  get  the  piece  of  land  that  we  wanted  alone,  we  bought 
the  entire  tract.  It  is  owned  by  the  same  parties,  and  controlled 
entirely  in  the  same  way  as  the  railroad.  Now,  I  was  wondering 
what  would  be  the  result  of  confiscating  that  land.  Some  say  that  it 
would  go  to  the  State.  It  is  my  opinion  that  it  would  go  back  to  its 
original  owners,  if  it  did.  The  portion  of  this  land  which  is  deeded 
in  ice  to  the  railroad  company  we  would  take  anyhow.  1  was  trying 
to  figure  out  how  much  I  could  save  of  it  if  this  did  pass.  All  that 
portion  which  is  deeded  to  the  Pacific  Land  Investment  Company 
and  the  title  derived  through  them  would  come  back  to  the  corpo- 
ration. 

Senator  Cross — You  think  it  would  revert  to  them?    A.  That  is 


118 

my  opinion.  But  I  do  not  think  that  they  mean  it — I  believe  in  the 
American  people.  I  don't  believe  that  anybody  desires  it.  They  say 
it,  but  they  don't  mean  it. 

Senator  Kellogg — What  do  they  say  so  for?  A.  I  don't  want 
to  say;  I  might  be  accused  of  being  prejudiced;  but  I  know  that  I 
don't  want  any  more. 

Senator  Vrooman — Are  you  a  candidate  for  Congress?  A.  No, 
sir;  I  beg  leave  to  decline.     I  couldn't  be  got  up. 

Q.  How  much  of  this  Colorado  River  and  San  Francisco  road  has 
been  constructed?  A.  From  the  end  of  the  new  mole  to  Alameda 
Point — about  two  miles  and  three  quarters — to  the  trestle  and  bridge. 

Q.  Is  that  where  the  new  depot  is,  on  the  Alameda  side?  A.  Yes, 
sir. 

Q.  From  what  States  did  the  constructing  parties  get  their  charter? 
A.  From  the  State  of  California. 

Q.  Would  that  road,  when  constructed,  extend  outside  of  the 
State?  A.  Of  course  it  would  extend  to  the  Colorado  River — but  I 
shall  not  do  it  myself,  and  I  would  not  recommend  a  friend  of  mine 
to  put  his  money  in  railroads  in  the  present  condition  of  the  State. 

Q.  I  understood  you  to  state  that  you  had  suspended  work  on  this 
railroad.  Is  that  true?  A.  No;  we  have  suspended  action.  We 
went  far  enough  to  carrjr  out  the  organization.  We  suspended  finan- 
cial action  because  it  looked  to  me  like  we  would  be  able  to  get  no 
securities.  We  are  entirely  willing  to  do  it,  but  we  want  to  be  safe 
about  it. 

Q..  When  did  you  suspend  action?  A.  About  the  beginning,  or 
just  after  the  adoption  of  the  new  Constitution.  Of  course,  we  have 
spent  some  money  since,  because  we  were  obliged  to.  We  desire  to 
save  our  investments.  Our  road  is  doing  a  considerable  business. 
Last  year  we  earned  nine  thousand  dollars  a  mile  gross  on  our  road, 
and  it  paid  a  profit  because  the  line  is  short  and  the  service  first  class, 
and  the  patrons  all  satisfied;  but  the  proprietors  are  not. 

Q.  How  long  have  you  been  operating  the  Alameda  County  road? 
A.  Five  or  six  years. 

Q.  Have  you  had  a  good  deal  to  do?  A.  All  the  business  of  that 
county. 

Q.  State  whether  or  not  there  is  any  demand  on  the  part  of  the 
people  of  that  county  for  such  legislation  as  is  contained  in  the  Barry 
bill?  A.  Not  to  my  knowledge.  I  am  free  to  say  that  there  is  no 
patron  of  our  road  that  has  ever  intimated  to  me  anything  of  the 
sort. 

Q.  Have  you  heard  any  complaints  from  any  persons  that  were 
considered  reliable  concerning  the  present  transportation  facilities 
furnished  to  the  people  of  that  county?    A.  Yes,  sir;  of  course. 

Q.  Any  complaints?     A.  Yes,  sir. 

Q.  Were  they  well  founded?  A.  No,  of  course  not.  Some  people 
would  complain  if  they  were  going  to  be  hanged,  but  I  have  heard 
of  nothing  that  is  worth  noticing  at  all. 

Q.  What  are  the  conditions  with  respect  to  manufacturing  in  Oak- 
land as  compared  with  what  they  were  five  or  six  years  ago?  A.  A 
benefit  to  the  people  wherever  there'is  any  reasonable  competition ; 


119 

an  unmitigated  benefit  everywhere  as  to  their  being  transported  and 
to  the  value  of  their  property.  I  mean  to  say,  so  far  as  would  be 
consistent  with  the  terrible  times  we  have  had  for  the  last  three  or 
four  years — at  the  time  of  the  great  depression,  when  property  went 
down  fifty  per  cent  in  San  Francisco;  but  it  did  not  affect  the  prop- 
erty value  in  Oakland;  it  held  its  own.  And  I  am  continually 
requested  by  the  property  owners  to  push  the  road  out — that  is  the 
way  to  help  us.  I  say,  "Yes,  I  would  like  to  help  you ;  I  would  like 
to  help  myself  a  little,  too." 

Q.  Isn't  it  true  that  there  has  been,  during  the  last  three  or  four 
years,  large  manufacturing  industries  started  there  in  consequence 
of  the  competition  of  the  railroads?     A.  Certainly. 

Senator  Spencer — Your  idea  of  "discrimination"  is  illustrated 
by  saying  that  you  wanted  to  start  a  manufactory?  A.  A  sugar 
re  fineiy. 

Q.  And  your  idea  was  that  under  this  bill  you  would  have  to  trans- 
port all  persons  and  freight  to  that  point  at  the  same  price?  A.  I  so 
understand  the  bill. 

Q.  And  that  is  one  of  your  objections  on  the  basis  of  discrim- 
ination?   A.  That  is  one  of  my  objections. 

Q.  Do  you  agree  with  section  twenty-one  of  article  twelve  of  the 
Constitution?  A.  That  is  a  legal  question,  and  I  can't  answer  any- 
thing about  such  things. 

Q.  Wouldn't  that  provision  comprehend  your  idea  of  discrimina- 
tion? A.  No;  that  Constitution  was  passed  after  I  commenced 
this  iniquity.  I  commenced  to  do  this  before  you  commenced  to 
interfere  with  my  operations. 

Q.  You  would  never  have  built  a  railroad,  then,  subsequent  to  the 
adoption  of  the  new  Constitution?    A,  Not  an  inch. 

Q.  Do  you  understand  that  previous  to  the  adoption  of  the  new 
Constitution  there  was  not  any  discrimination  between  persons  as  to 
the  same  character  of  freight?  Do  you  claim  that  freight  was  ever 
charged  to  one  more  than  to  another?  A.  I  want  to  answer  that  in 
this  way:  There  are  a  great  many  things  said  in  that  new  Constitu- 
tion, and  some  of  them  have  been  entirely  explained  away  by  the 
Supreme  Court,  and  I  hope  they  will  explain  that  away. 

Q.  You  do  not  believe  in  the  principle  enunciated  by  the  Granger 
cases?     A.  No. 

Q.  You  do  not  believe  that  it  is  right?    A.  No. 

Q.  You  differ  with  the  Supreme  Court  of  the  United  States?  A.  I 
do,  so  far  as  I  understand  it.  I  don't  like  to  put  my  opinion  up 
against  theirs,  but  for  myself  I  am  going  to  disagree. 

Q.  I  understand  you  to  say,  that  in  shipping  freight  to  your  ter- 
minal points,  you  should  be  allowed  to  discriminate  between  two 
persons?    A.  I  do  in  some  cases. 

Q.  That  is  for  the  purposes  of  the  success  of  the  railroad  people  in 
developing  the  country?  A.  No.  There  is  another  way  of  putting 
it.  Human  nature  is  very  much  the  same  all  over  the  world.  If  I 
kept  a  grocery  store,  and  two  men  came  in  who  were  both  anxious 
to  be  served  at  the  moment,  I  don't  think  I  should  wait  on  the  man 
who  bought  the  fewest  goods  first,  would  you  ? 


120 

Q,  I  am  not  answering.  I  don't  understand  that  to  be  a  parallel. 
You  understand  that  transportation  companies  have  a  lien  on  goods 
for  the  freight  ?     A.  I  understand  that. 

Q.  Therefore  your  illustration  is  not  a  parallel?  A.  I  think  that 
the  grocery  man  has  a  lien,  too. 

Q.  He  has  a  lien  as  long  as  he  holds  on  to  it?  A.  I  believe  in 
people  paying  their  debts;  I  would  not  favor  any  law  that  would 
allow  men  to  avoid  them. 

Q.  Do  you  believe  in  a  railroad  company  paying  all  the  damages 
done  when'they  injure  a  party?  A.  Practice  is  a  little  better  than 
theory.  I  always  proceed  to  investigate  into  the  matter.  I  have 
paid  damages. 

Q.  I  am  not  speaking  about  you.  I  think  there  has  been  no  com- 
plaint about  you.  But  do  you  think  that,  if  a  farmer  at  Santa  Cruz 
should  bring  an  action  against  the  Central  Pacific  Railroad,  it  is  right 
that  it  should  be  transferred  to  San  Francisco,  instead  of  being  tried  in 
the  Court  nearest  to  him?  A.  It  is  a  pretty  hard  case  for  him.  I 
don't  know  about  the  abstract  justice  of  it. 

Q.  Don't  you  think  that  the  corporations  of  the  State  doing  busi- 
ness in  the  State  should  be  subservient  to  the  State  and  to  State  sov- 
ereignty, and  be  governed  by  their  laws?    A.  Yes,  sir;  I  think  so. 

Q.  If  a  foreign  corporation  is  doing  business  here  is  there  any 
question  that  they  should  be  subject  to  the  State  laws?  A.  That  is  a 
legal  question;  I  don't  think  so. 

Q.  If  this  provision  of  the  bill  would  prevent  the  trouble  in  that 
direction  you  would  not  so  seriously  object  to  it?  A.  There  is  no 
way  by  which  I  can  see  any  good  in  the  bill  or  any  part  of  it. 

Q.  Did  you  not  start  in  a  little  prejudiced  against  it?  A.  May  be 
so.  I  think  I  am  a  little;  I  think  I  am  a  good  deal.  The  fact  is,  if 
all  men  conducting  railroads  conducted  the  business  honestly,  the 
same  as  they  do  other  business,  there  would  be  no  need  of  laws. 

Q.  Do  you  think  that  there  ought  to  be  any  more  privileges  granted 
to  corporations  than  there  are  to  natural  persons?  A.  They  ought 
to  be  all  on  the  same  footing.  Then,  there  is  another  thing — let  me 
follow  it  out  logically:  Is  there  any  reason  why  a  corporation 
should  not  have  equal  rights  with  others? 

Q.  No,  sir.     A.  Then  that  is  all  there  is  of  it. 

Q.  Do  they  not  want  their  privileges  and  immunities  greater?  A. 
They  may  on  account  of  their  extensive  business  and  the  necessary 
capital  and  resource  to  carry  on  the  business;  and  they  may  be  in 
many  instances  tyrannical  and  overbearing. 

Q.  Do  you  say  that  you  have  heard  no  complaints  in  this  State 
against  the  Central  Pacific  Railroad  Company  on  account  of  dis- 
crimination? A.  I  said  no  such  thing;  but  I  mean  to  say  that  all 
the  stories  that  are  told  are  not  true;  there  are  many  of  them  true. 
I  don't  think  that  they  are  treating  the  Legislature  or  the  people  of 
this  State  right;  I  think  that  they  are  being  wrongly  guided.  From 
my  standpoint  I  can't  say  that  anything  we  have  ever  done,  or  any 
view  that  we  have  ever  taken,  goes  to  the  real  merits  of  the  question. 
I  don't  know  exactly  what  is  needed,  but  certainly  nothing  is  to  be 
gained  by  tearing  down;  what  we  want  to  do,  is  to  build  up. 


121 

Q.  Do  you  believe  that,  under  any  circumstances,  there  should  be 
any  forfeiture  of  the  charter  of  a  railroad  company?  A.  No;  I  don't 
think  a  man's  property  ought  to  be  'taken  away  from  him  at  any 
time  without  consideration;  I  consider  that  a  very  great  crime.  I 
think  to  take  a  man's  property  is  a  pretty  tough  business,  and  it  is 
not  often  done;  with  that  there  is  apt  to  be  kicking  and  some  little 
explanation ;  if  it  is  carried  on  to  any  great  extent  it  will  cause  some 
kicking. 

Q.  Then  you  assume  that  every  railroad  holds  property  in  the 
State  the  same  as  a  natural  person  holds  private  property?  A.  I 
never  said  any  such  thing. 

Q.  What  property  do  you  have  reference  to  in  this  case?  A.  If 
some  gentleman  should  step  into  my  office  and  quietly  set  down  and 
say,  "Davis,  you  don't  own  this  railroad;"  I  would  look  at  him  first 
to  see  whether  he  was  insane  or  not.  I  don't  own  this  railroad ;  then 
what  have  I  been  setting  here  signing  checks  for  all  this  time;  am  I 
crazy,  or  you  ?     I  begin  to  argue  with  myself  which  it  is. 

Q.  You  believe  that  if  a  man  has  property  in  this  State,  that  it 
should  come  under  the  jurisdiction  of  the  State  Government?  A. 
That  is  what  I  believe. 

Q,.  Do  you  recognize  the  difference  between  the  roads  built  by  sub- 
sidies, and  those-  built  by  private  capital?    A.  I  do,  decidedly. 

Q.  To  what  extent  wrould  you  discriminate  between  them?  A. 
That  I  didn't  get  any  of  it. 

Q.  I  suppose,  in  looking  over  this  subject,  and  trying  to  ascertain 
how  it  was  that  you  didn't  get  any  of  it,  it  must  be  attributed  to  your 
natural  modesty?  A.  No,  I  didn't  begin  early  enough  ;  I  don't  pro- 
fess to  be  so  excessively  modest  as  all  that. 

Q.  Now,  outside  of  the  funny  side  of  this  I  will  ask- A.  Well, 

that  is  right ;  this  is  a  grave  subject ;  I  tell  you,  it  is  ;  it  is  a  big  sub- 
ject, and  it  is  not  to  be  laughed  about. 

Q.  Well,  you  put  us  in  a  good  humor,  and  we  had  better  discuss  in 
that  manner  than  in  a  bad  humor.  Do  you  claim  that  you  have  a 
right  to  discriminate  where  a  road  is  not  subsidized,  the  same  as 
where  one  is  subsidized?  A.  None  that  I  could  define.  I  have  busi- 
ness experience  and  judgment,  and  mj^  notion,  founded  upon  that 
is,  if  I  have  given  anybody  anything,  it  is  mean  to  take  it  back  ;  thatis 
what  I  think  ;  I  say  the}'  never  should  have  done  it;  I  say  that  it  is 
pleading  the  baby  act;  itis  not  manly  or  just;  I  say  that;  I  say  that  if 
the  General  Government  gave  the  Central  Pacific  Railroad  Company 
large  sums  of  money,  from  this  State  and  from  the  counties,  and  if 
there  was  no  condition  to  it — if  they  received  large  sums  of  money 
as  a  donation,  and  I  understand  it  was  put  in  that  form — I  say  that 
if  they  did,  I  don't  know  any  better  owner  for  it  than  the  people  who 
received  it. 

Q,  But  you  think  that  if  they  did  give  it  to  them  that  they  should 
act  squarely  and  honestly  by  the  people?  A.  Now  you  reach  the 
point  that  is  not  law;  it  is  only  the  result  of  men's  actions — I  think 
they  are  very  ungrateful. 

Q.  If  the  moneys  and  lands  were  given  to  them  upon  conditions 
yon  think  that  the  conditions  should  be  complied  with?  A.  I  cer- 
tainlv  do. 


122 

Q.  In  running  your  railroad  you  have  no  serious  complaints  as  to 
your  manner  of  conducting  it?     A.  No. 

Q.  Do  you  think  that  under  this  bill  there  would  be  any  liability 
to  injure  you  if  there  has  been  no  complaint  against  you  ?  A.  Well, 
I  declare  there  is  only  one  answer.  I  don't  desire  to  be  so  well  off  as 
this  bill  would  seem  to  make  me. 

Q.  Supposing  that  there  were  other  men  building  roads  in  other 
portions  of  the  State  that  did  not  act  as  well  as  you;  we  could  not 
make  a  special  law  for  them.  Would  not  this  be  better  than  no  law 
for  them  ?  A.  I  am  not  mean  enough  to  punish  one  man  for  another 
man's  crime. 

Q.  You  are  old  enough  and  wise  enough  to  know  that  these  laws 
have  to  be  general  in  their  character?     A.  Certainly  they  do. 

Q.  And  you  know  that  a  general  law  works  hardships  sometimes 
in  particular  cases?  A.  Why,  certainly ;  there  can  be  no  perfect 
justice — not  on  this  side  of  the  river,  anyhow. 

Q.  Do  you  believe  that  if  I  brought  my  freight  to  you  for  ship- 
ment before  another  man  brought  his,  that  his  should  be  shipped 
first  regardless  of  my  wishes?  A.  If  you  can  devise  any  law  to  pre- 
vent anything  of  the  kind  without  taking  my  railroad,  I  have  no 
objection.  I  say  that  it  is  wrong,  and  I  think  it  ought  to  be  remedied, 
but  the  remedy  is  so  serious  that  I  confess  that  I  cannot  see  the 
necessity  for  it,  or  for  any  such  legislation. 

Q.  Do  you  think  that  there  would  be  any  trouble  in  living  up  to 
the  reasonable  requirements  of  a  law  of  that  kind?  A.  In  my 
opinion  there  is  not  a  man  in  the  State  that  would  be  satisfied  if  the 
principles  enunciated  in  this  bill  would  be  carried  out,  if  he  has  any 
business  with  the  railroads.  I  say  this  in  connection  with  this  bill — 
that  it  is  needless  and  mischievous,  and  does  not  in  my  opinion 
give  any  redress  commensurate  with  the  damages  that  it  is  liable  to 
do. 

Q.  Supposing  that  I  take  three  hundred  tons  of  wheat  to  your  sta- 
tion and  have  it  there  for  a  week,  asking  that  it  be  shipped,  and  that 
at  the  end  of  that  time  another  man  comes  there  with  a  like  amount, 
and  his  is  shipped  first;  do  you  think  that  would  be  right?  A.  If  I 
deliberately  hold  that  wheat,  I  should  say  that  it  was  a  very  dishon- 
est act. 

Q.  Supposing  that  that  is  practiced  generally,  do  you  think  it  is 
right?  A.  If  it  is  practiced  generally,  it  is  not  right,  but  I  don't 
believe  it  is. 

Q.  Do  you  not  think  that  the  penalty  ought  to  be  severe  if  it  is 
practiced  generally?     A.  Yes,  sir. 

Q.  If  it  can  be  practiced,  can  it  not  be  practiced  to  the  ruination  of 
a  man's  property?  A.  Certainly  it  can,  but  the  penalty  ought  not  to 
go  to  the  extent  of  confiscating  the  property. 

Q.  Don't  you  think,  if  the  railroads  would  be  more  accommodating, 
that  there  would  be  less  trouble?  A.  Certainly;  you  can't  drive  the 
people. 

Q.  You  do  not  pretend  that,  if  this  bill  is  passed,  you  will  not  have 
a  right  to  contest  any  of  these  matters,  and  have  your  day  in  Court? 
A.  I  don't  want  to  go  into  Court  upon  any  such  pretext. 


123 

Q.  The  railroad  men  don't  like  to  go  into  Court,  anyhow,  do  they? 
A.  If  yon  make  a  general  application  I  will  make  you  an  answer.  If 
you  include  me 

Q.  You  seem  to  think  that  this  bill  is  made  for  your  road  ;  this  is 
made  for  all  roads.     A.  Yes,  but  I  am  in  the  bundle. 

Q.  I  understand  that  your  conduct  is  so  admirable  in  the  conduct- 
ing of  your  road  that  your  patrons  have  no  cause  for  complaint? 
A.  I  do  not  desire  to  say  anything  about  that;  I  would  rather  some- 
body else  would  say  that.  I  wish  that  that  reputation  would  do  me 
some  good. 

Q.  In  regard  to  the  lumber  business  in  Mendocino  County,  you 
claim  that  discrimination  is  necessary  there  in  that  instance?  A.  In 
Santa  Cruz  County;  yes,  sir,  there  would  be  a  discrimination  against 
Mendocino  County  by  taking  that  lumber.  Isn't  that  a  discrimina- 
tion between  persons  and  places? 

Q.  Is  that  the  way  you  construe  this  bill?  A.  That  is  the  way  I 
understand  it. 

Q.  Your  opinion  of  this  bill  depends  a  good  deal  upon  the  con- 
struction you  put  upon  it?  A.  Of  course,  I  am  only  giving  my 
understanding  of  it. 

Q.  One  of  your  reasons  is  that  under  this  bill  if  you  wanted  to 
be  dishonest  you  could  incorporate,  and  then  run  the  stock  down 
almost  to  nothing,  and  that  you  could  do  this  by  committing  some 
act  of  forfeiture,  and  force  them  to  sell  at  a  very  small  price.  Would 
not  a  man  be  guilty  of  conspiracy  in  doing  that?  A.  I  think  very 
likely. 

Q.  You  can't  legislate  to  make  men  honest?  A.  I  have  never 
known  of  such  a  case. 

Q.  Such  a  thing  is  an  exception  to  the  general  rule?  A.  I  know 
that  men  frequently  take  the  chances  of  going  to  jail,  and  a  good 
many  of  them  slip  through. 

Q.  We  can't  help  that?    A.  I  can't  either. 

Senator  Sullivan — Does  not  this  road  to  Alameda  and  San  Jose 
run  between  the  Bay  of  San  Francisco  and  the  Central  Pacific  nearly 
all  the  way?  A.  It  does.  It  runs  between  the  Western  Pacific  and 
the  branch.     The  Western  Pacific  goes  up  by  Niles. 

Q.  So  that  you  have  competition  by  the  Central  Pacific  Railroad 
and  the  bay?    A.  For  that  distance  we  have. 

Q.  Then,  on  the  Santa  Cruz  side  you  have  the  other?    A.  Yes,  sir. 

Q.  The  fact  that  you  have  competition  makes  you  exceedingly 
pleasant  and  agreeable  with  your  patrons?  A.  I  imagine  that  has 
considerable  effect  upon  me. 

Q.  It  goes  a  long  way  towards  making  your  road  popular?  A. 
Yes,  sir. 

Senator  Murphy — Is  there  any  special  contract  system  upon  your 
road?     A.  Not  that  I  know  of. 

Q.  Do  you  oblige  any  shipper  for  whom  you  cany  goods  to  carry 
all  his  freight  by  rail?     A.  No,  sir. 

Q.  Do  you  make  him  agree  not  to  buy  from  or  sell  to  any  mer- 
chant who  does  not  ship  by  rail?    A.  No,  sir. 

Q.  Do  you  have  the  right  in  any  manner  to  examine  the  books  of 
the  shipper  to  see  whether  they  are  doing  so?    A.  No,  sir. 


124 

Q.  Do  you  not  know,  as  a  railroad  man,  that  there  are  such  prac- 
tices in  the  State  of  California?  A.  Not  of  my  own  knowledge.  I 
have  heard  that  it  is  so. 

Q.  Have  you  heard  of  any  complaints  upon  that  ground?  A.  I 
have  heard  them  loud  enough  to  threaten  the  road;  I  have  heard  a 
great  many. 

Q.  Are  you  of  the  opinion  that  such  contracts  are  against  public 
policy?    A.  I  don't  know  of  any  contracts. 

Q.  Do  you  know  of  the  existence  of  such  contracts  in  any  way? 
A.  I  never  saw  one;  I  have  heard  people  speak  about  them. 

Q.  Assuming  that  such  contracts  exist,  do  you  not  think  that  such 
contracts  are  detrimental  to  the  people  of  the  State  of  California,  and 
to  the  shipping  interests  of  the  Pacific  Coast?  A.  It  is  a  serious 
question.  If  they  do  have  such  contracts  with  the  people,  and  enforce 
them,  they  must  have  some  good  reason  for  it.  Whether  it  is  merely 
mercenary  or  not  I  am  not  prepared  to  say.  If  it  is,  it  is  all  entirely 
wrong;  if  I  knew  of  the  reasons  why  they  do  make  them,  I  would  be 
willing  to  venture  my  opinion  upon  it.  If  there  are  good  and  justi- 
fiable reasons,  I  don't  know  of  any. 

Q.  Assuming  that  those  contracts  exist,  and  that  their  effect  is  to 
drive  away  the  shipping  interests  from  the  various  portions  of  the 
State  of  California,  do  you  not  think  they  are  against  public  policy? 
A.  If  it  is  wholly  for  mercenary  purposes,  it  is  wrong  and  against 
public  policy,  and  ought  to  be  suppressed;  but  they  may  have  good 
reasons  that  I  don't  know  anything  about. 

Q.  Do  you  know  of  a  certain  suit  brought  by  the  firm  of  Richards 
&  Harrison  against  the  Central  Pacific  Railroad  ?  A.  I  have  heard 
something  about  it. 

Q.  Are  you  familiar  with  that  suit  in  any  way?  A.  I  have  not 
heard  enough  about  it  to  give  you  an  intelligent  opinion  about  it. 

Q.  If  these  special  contracts  exist,  do  you  not  think  that  the  law 
should  correct  them  ?  A.  If  these  contracts  exist,  and  they  are  used 
for  a  mercenary  purpose ;  that  is,  if  they  set  themselves  up  as  a  power 
above  the  law  to  make  and  unmake  individuals,  I  say  it  is  all  wrong, 
and  if  it  is  true,  they  ought  not  to  be  allowed  to  do  it. 

Senator  Sullivan — Why  should  they  desire  to  inspect  the  books 
of  the  shipper?     A.  That  is  beyond  my  knowledge. 

Q.  Why  should  they  forbid  one  man  to  buy  goods  from  another, 
simply  because  they  came  around  Cape  Horn?  A.  If  it  be  true,  I  don't 
know  why;  I  don't  know  of  any  right  that  they  have  over  those 
people;  I  don't  know  that  such  a  thing  is  so.  Ii  they  did  it  with 
me  I  know  what  1  would  say. 

Q.  What  would  you  say?     A.  I  would  tell  them  to  go  to  the  devil. 

Q.  Supposing  you  couldn't  tell  them  to  go  to  the  devil?  A.  But  I 
could. 

Q.  What  would  you  do  if  there  was  no  competition?  A.  If  it  was 
so  that  I  could  not  cure  it  I  would  just  endure  it;  I  wouldn't  stop  to 
growl  about  it.  In  the  course  of  my  life  I  have  found  that  it  is  not 
a  good  thing  to  buck  my  head  against  a  stone  wall. 

Q.  Would  not  you  want  the  Legislature  of  the  State  of  California 
to  relieve  you  from  that?    A.  Not  if  it  hurt  somebody  else  a  great  deal 


125 

more.  I  believe  in  just  laws.  I  said  that  I  did  not  think  there  could 
be  any  perfect  justice  on  this  side  of  the  river.  It  is  impossible  for 
laws  to  be  made  to  cover  everything. 

Q.  Then,  you  do  not  know  of  the  existence  of  special  contracts? 
A.  No.  If  they  do  exist  for  mercenary  purposes,  or  for  tyrannical 
purposes,  they  ought  to  be  severely  punished. 

Q.  Do  you  think  that  forfeiture  of  the  charter  would  be  too  severe? 
A.  Yes,  sir,  I  do;  I  am  not  so  handy  with  that  sort  of  an  ax. 

Q.  Do  you  think  that  a  penalty  inflicted  by  the  officers  of  the  com- 
pany would  be  correct?  A.  Yes,  sir;  but  I  would  not  take  the  prop- 
erty. 

Q.  Would  you  consent  to  the  company  being  fined  a  certain  sum 
of  money?     A.  Yes,  I  think  that  would  prevent  it. 

Senator  Cross — What  would  probably  be  the  effect  of  the  passage 
of  this  law  upon  the  volume  of  railroad  business?  A.  I  have  stated 
that  I  thought  it  would  be  meddlesome  and  pernicious,  and  be  of  no 
possible  use  to  anybody,  but  on  the  contrary,  it  may  do  a  great  deal 
of  harm. 

Q.  Do  you  think  it  would  increase  the  volume  of  business?  A.  I 
could  not  say  so  and  have  my  answers  consistent. 

Q.  Could  you  state  approximately  the  number  of  persons  em- 
ployed in  this  State  by  railroad  companies?  A.  Ten  or  twelve  thou- 
sand. 

Senator  Vrooman — Do  you  know  of  any  person  who  has  been 
ruined,  or  has  suffered  the  ruination  of  his  property,  by  the  railroad 
business?     A.  No,  sir. 

Q.  Have  you,  in  your  business  in  this  State,  had  occasion  to  trans- 
port freight  over  roads  other  than  your  own  ?    A.  I  have. 

Q.  Have  you  ever  known  a  case  where  freight  has  not  been  trans- 
ported in  the  order  in  which  it  has  been  received,  as  nearly  as  it 
could  be  done?     A.  No;  I  don't  know  of  any  such  instance. 

Q.  How  long  have  you  been  transporting  freight  over  railroads? 
A.  Since  the  commencement  of  our  road.  All  of  our  rolling  stock, 
and  engines,  and  locomotives  came  over  the  Central  Pacific  Railroad. 

Q.  And  during  all  that  time  you  never  saw  the  necessity  of  a  law 
compelling  the  railroad  company  to  forward  freight  in  the  order  in 
which  it  is  received?    A.  Not  at  all. 

Senator  Cross — By  whom  is  the  forwarding  of  freight  attended 
to  upon  your  road?    A.  By  a  general  freight  and  passenger  agent. 

Q.  In  the  different  localities,  at  the  different  stations,  who  has 
charge?  A.  The  agent,  subject  to  orders.  On  the  Central  Pacific 
Railroad  I  think  that  they  have  a  station  agent,  who  has  charge  of 
those  matters. 

Q.  At  each  station  there  is  a  local  agent?  A.  Yes,  sir;  except  at 
the  flag  stations. 

Q.  Those  local  agents  have  the  power  to  forward  freight  in  the 
order  in  which  it  is  received,  or  in  a  different  order?  A.  Certainly, 
if  they  chose.  If  they  choose  to  behave  wrong,  it  is  in  their  power, 
because  the  general  freight  agent  might  not  be  able  to  go  there  to  see 
him  more  than  once  a  month  or  longer. 

Senator  Spencer — Do  you  require  freight   in   advance?    A.  I 


126 

believe  that  there  is  some  such  instances,  but  I  don't  know  that  they 
enforce  any  such  rule,  unless  it  is  shipped  to  a  station  where  there  is 
no  agent  to  collect. 

Q.  Do  you  have  a  system  of  "rebates?"  A.  Of  course  we  make 
rebates. 

Q.  Let  me  hear  you  define  "rebate?"  A.  All  that  I  understand 
it  to  mean  is  that  a  company  are  to  pay  back  a  certain  amount  of  the 
regular  charge.  You  understand  that  people  in  the  railroad  business 
will  make  mistakes  the  same  as  anybody  else — and  they  may  make  an 
overcharge — or  they  may  classify  goods  in  the  wrong  class.  If  there 
is  anything  overcharged  that  is  a  rebate,  and  it  is  repaid. 

Q.  Suppose  that  a  person  were  shipping  goocls  over  your  road,  and 
that  you  charged  him  twenty  dollars,  while  the  regular  charge  was 
ten — and  then  return  him  the  ten  dollars  at  a  subsequent  time?  A. 
I  would  not  knowingly  overcharge  him. 

Q.  Do  you  know  of  such  a  system  being  practiced  in  this  State  by 
the  railroad  compan}^?  A.  No,  sir.  If  it  is  so,  it  is  wrong,  and 
ought  not  to  be  allowed. 

Q.  You  believe  that  everybody  should  be  allowed  to  ship  their 
goods  at  open  rates?  A.  Certainly;  every  man  ought  to  be  charged 
alike  for  like  services,  and  I  don't  think  that  any  railroad  company 
would  do  any  other  business. 

Q.  Supposing  that  a  contract  is  made  by  the  Central  Pacific  Rail- 
road, or  by  any  other  company,  to  the  effect  that  they  shall  ship  all 
their  goods  by  rail  and  none  by  water,  and  that  they  shall  not  deal 
with  any  person  who  does  ship  by  water,  or  by  any  other  mode  of 
transportation;  that  if  he  did  he  would  have  his  contract  broken; 
do  you  think  that  would  be  right?  A.  I  hardly  know  how  to  answer 
that  question. 

Q.  Supposing  that  such  a  contract  did  exist ;  would  it  not  have  a 
tendency  to  lessen  the  shipping  by  water?    A.  Evidently. 

Senator  Vrooman — If  any  such  contract  exists  by  which  men 
shipping  freight  from  New  York  to  San  Francisco,  by  rail,  can  send 
it  cheaper  than  by  water,  does  that  lessen  the  shipment  by  water  ?  A. 
Certainly  it  does,  but  not  to  the  disadvantage  of  the  shipper. 

Q.  Not  to  the  disadvantage  of  the  people  of  the  State?  A.  No, 
sir. 

Q.  Is  it  possible  to  reduce  the  classification  under  the  railroad  sys- 
tem down  to  thirty  or  forty  classes,  or  down  to  five  or  ten  classes? 
A.  I  am  not  expert  enough  to  answer  the  question  as  it  ought  to  be. 
It  is  an  intricate  subject.  There  is  enough  to  be  said  upon  it  to  fill 
a  book,  that  lam  aware  of.  I  know  that  the  classifications  areas 
various  as  the  motives  of  men  and  the  mutations  of  commerce. 
There  is  everything  to  be  had  in  this  world,  and  in  this  country,  and 
they  all  come  under  some  sort  of  classification,  and  some  fixed  rule. 
The  true  policy  would  be  to  make  a  just  rule  and  apply  it  to  all. 
There  is  no  absolute  wrong ;  on  the  contrary,  there  is  an  absolute 
necessity  for  classification.  Supposing  that  you  send  furniture  worth 
five  hundred  dollars  to  my  people.  Under  the  law  of  common  car- 
riers, we  must  deliver  that  as  good  as  received.  We  should  get  more 
pay  for  carrying  that.     We  have  to  use  extra  care  in  handling  it. 


127 

We  have  to  pack  it  so  that  it  will  not  bruise.  If  we  break  a  looking 
glass  we  are  obliged  to  pay  for  it.  So  we  would  have  to  charge  more 
for  carrying  a  piano.  That  is  classification.  Classification,  as  a  rule, 
is  a  factor  in  the  business.  If  you  bring  me  an  animal  worth  fifty 
dollars,  and  I  charge  you  five  dollars  for  carrying  it  a  certain  dis- 
tance, and  you  bring  me  one  worth  a  thousand,  and  if  I  say,  "This 
should  be  worth  no  more  for  carrying  than  the  one  that  is  worth  fifty," 
you  would  say,  "Why,  this  is  my  choice  animal;  I  expect  you' to 
charge  a  certain  amount  more  than  you  do  for  the  other;"  and  so 
the  rule  of  classification  will  run  away  into  the  intricate  mutations 
of  commerce. 

Q.  Then  you  would  take  into  consideration  the  value  of  the  arti- 
cle? A.  Yes,  sir;  and  there  is  another  reason,  and  that  is  the  char- 
acter of  the  goods  to  be  transported.  Suppose  that  you  carry 
explosives,  powder  or  niter,  or  any  other  dangerous  article  which 
you  have  to  handle  with  extra  care  and  precaution,  and  where  the 
risk  is  great,  in  consequence  of  the  nature  of  the  goods,  to  other 
merchandise,  that  is  another  brand)  of  classification. 

Q.  Is  it  necessary  to  have  such  a  classification  that  every  article  will 
have  its  separate  classification,  or  is  it  possible  to  group  them  together 
in  a  few  classifications.  How  many  have  you  on  your  road?  A.  I 
do  not  know. 

Q.  Of  course  it  wrould  cost  about  the  same,  as  far  as  freight  is  con- 
cerned, to  carry  a  thoroughbred  horse  as  it  would  to  carry  a  mus- 
tang?    A.  Exactly. 

Q.  Do  you  consider  the  charge  of  one  in  excess  of  the  other  in  the 
nature  of  insurance?  A.  Yes,  sir.  That  is  insurance,  and  there  is 
no  mode  of  getting  at  it  without  insurance,  as  I  understand  it,  with- 
out classifying  them. 

Senator  Del  Valle — Do  you  know  that  they  tried  to  enforce  the 
rule  that  you  could  not  recover  more  than  one  hundred  dollars  for 
the  value  of  an  animal  that  was  hurt?     A.  I  heard  of  it. 

Q.  If  the  question  of  insurance  were  eliminated  from  this,  you 
could  carry  a  thoroughbred  as  cheap  as  you  could  a  mustang?  A.  I 
think  so.  If  both  are  of  the  same  weight  I  don't  know  that  it  could 
make  any  possible  difference. 


Statement  of  Mr.  Donahue. 

Senator  Sullivan — You  have  examined  the  Barry  bill?  An- 
swer— Yes,  sir. 

Q.  With  what  road  are  you  connected?  A.  The  San  Francisco 
and  North  Pacific  Coast  Railroad. 

Q.  Through  what  counties  does  it  run?    A.  Marin  and  Sonoma. 

Q.  What  is  its  length  ?  A.  The  length,  including  the  side  lines,  is 
about  one  hundred  miles. 

Q.  Was  that  road  built  by  private  capital,  or  by  the  assistance  of 
subsidies?  A.  The  road  was  built  by  my  father  out  of  his  own  per- 
sonal means. 


128 

Q.  How  much  was  invested  in  that  road?  A.  I  cannot  tell  exactly 
how  much,  because  the  earnings  of  the  road  were  put  back  into  it; 
but  the  investments,  including  the  earnings  and  expenses  of  the 
contemplated  branch  which  we  are  now  building,  is  about  four 
millions. 

Q..  Isn't  it  a  fact  that  you  did  receive  a  subsidy  from  Sonoma 
County?  A.  I  don't  know  that  only  from  hearsay.  The  matter  was 
brought  out  at  a  hearing  before  the  Railroad  Commissioners,  and  I 
understood  that  a  subsidy  of  two  hundred  and  sixty  thousand  dol- 
lars had  been  granted ;  if  so,  it  was  at  the  time  that  the  Central  Pacific 
Railroad  Company  owned  it. 

Q.  Who  built  the  road?  A.  My  father.  When  the  subsidy  was 
first  granted  it  was  granted  to  some  other  pal-ties,  and  they  built  a 
road  from  Donahue's  line,  about  thirty-four  miles  from  San  Fran- 
cisco, almost  to  Santa  Rosa.  Then  some  other  parties  started  an 
opposition  route,  and  they  were  forced  to  sell  out,  and  they  sold  to 
the  Central  Pacific  Railroad  Company,  and  they  completed  the  road 
to  Cloverdale,  and  when  the  Central  Pacific  Railroad  Company,  in 
1876,  were  undergoing  some  difficulties  with  the  Government,  my 
father  had  their  notes  and  bonds  for  a  large  sum  of  money,  and  he 
gave  them  their  notes  back  and  took  the  road.  And  since  that  time  he 
built  a  branch  twenty-two  miles  long  to  Petaluma,  which  laid  idle 
four  or  five  years,  and  another  branch  sixteen  miles.  We  never  got 
the  interest  on  what  it  cost  us. 

Q.  What  do  you  transport  over  your  road?  A.  General  merchan- 
dise and  farm  products. 

Q.  You  have  steamers  connected  with  the  road?  A.  Yes,  two 
steamers  have  been  plying  for  the  last  two  or  three  years  and  we  will 
have  another  one  in  a  few  weeks. 

Q.  You  have  competition  by  water?  A.  We  have  for  forty-two 
miles. 

Q.  State  what  you  think  about  the  Barry  bill;  whether  you  think 
it  will  be  favorable  or  unfavorable  to  you?  A.  In  its  present  form 
the  effects  of  the  bill  will  be  to  cause  us  to  give  up  the  operations  of 
the  road.  The  first  section  prevents  classification,  and  without 
classification  we  would  be  unable  to  operate  the  road,  because  you 
can't  carry  a  carload  of  silk  at  the  same  price  as  you  can  a  carload  of 
brick,  and  the  remuneration  ought  to  be  different.  They  say  that 
there  are  hundreds  of  classifications.  That  is  a  mistake.  We  have 
only  four — one,  two,  three,  four. 

Q.  Upon  what  does  that  classification  depend?  A.  It  depends 
upon  the  liability  in  case  of  damage  to  the  goods,  and  in  other  cases 
to  the  quantity  of  the  goods. 

Q.  Is  not  your  classification  based  :  First,  upon  the  distance;  sec- 
ond, the  measurement;  third,  the  bulk;  and,  fourth,  the  insurance? 
A.  The  three  last,  yes;  but  not  the  first. 

Q.  Why?  A.  Because  distance  does  not  come  into  the  classifica- 
tion of  goods.  All  goods  of  a  certain  class  must  be  carried  in  the 
same  manner  as  goods  of  the  same  class  for  all  distances,  of  course 
upon  a  graduated  scale. 

Q.  If  you  ship  goods  from  Cloverdale  to  San  Francisco,  you  charge 


129 

more  than  from  Santa  Rosa  to  San  Francisco?  A.  We  do,  but  not 
per  mile.  The  goods  are  not  so  much  per  ton  per  mile;  and  that  is 
the  objection  in  this  bill.  It  says,  in  the  first  section,  "except  as 
hereinafter  provided,"  and  gives,  on  line  seven  of  section  two.  the 
conditions.  Now,  our  objection  to  that  is  that  we  have  competition 
for  forty-two  miles  by  water;  and  secondly,  that  fixes  a  minimum 
rate  on  the  road  to  that  point.  Our  rates  now  are  under  the  mini- 
mum rate  between  the  two  points,  and  we  are  not  to-day  paying 
expenses  there;  and  if  it  were  applied  to  the  whole  road  we  couldn't 
run  it  any  longer.  I  asked  the  gentleman  who  introduced  the  bill 
if  that  was  not  its  meaning,  and  he  said  it  was.  Then  our  present 
minimum  rate  per  mile  would  be  the  maximum  rate  for  the  whole 
road. 

Q.  What  would  you  suggest  as  an  amendment  to  section  one,  to 
avoid  this  difficulty  that  you  speak  of?  A.  I  would  suggest  that  no 
discrimination  to  any  person  should  be  made  at  the  same  shipping 
points;  that  everybody  in  Santa  Itosa  and  everybody  in  Healdsburg 
should  have  the  same  open  rate,  and  Petaluma  the  same.  We  have 
"no  objection  to  that,  because  we  always  give  an  open  rate;  but  this 
bill  would  forbid  that,  and  force  us  to  give  a  minimum  rate.  For 
instance,  we  made  our  road  for  the  purpose  of  enabling  shippers  to 
ship  wheat,  and  at  one  season  of  the  year  our  cars  would  lie  idle; 
and  it  is  better  to  have  them  doing  a  little  something,  and  so  we 
have  been  trying  to  ship  some  wood;  and  we  also  do  something  in 
the  way  of  sending  up  provisions  for  men  that  are  chopping  wood, 
and  the  freights  and  fares  are  helping  us  out  in  that  way.  If  we 
were  forced  to  put  a  minimum  rate  on  our  road,  we  should  be  com- 
pelled to  make  the  same  rate  on  the  whole  road. 

Q.  If  the  words  you  suggested  were  inserted,  would  that  meet  your 
objection  to  section  one?  A.  I  would  insert  "at  the  same  point  or 
under  similar  circumstances." 

Q.  What  do  you  mean  by  that?  A.  If  two  or  three  wagons  of 
freight  came  up  to  the  station,  we  would  not  take  one  man's,  and 
make  the  other  wait  to  the  last,  but  take  them  all  as  convenience 
offers,  if  they  are  at  the  same  point,  and  forward  them  in  the  order 
in  which  they  arrived.  If  they  were  delivered  at  a  side  track  out 
of  town,  that  would  not  be  under  similar  circumstances,  and  we 
would  have  to  make  a  different  rate. 

Q.  Have  you  any  special  contract  system  upon  your  road?  A.  No, 
sir;  we  have  open  rates  for  every  one. 

Q.  You  have  heard  of  the  special  contract  system  ?     A.  Yes,  sir. 

Q.  Do  you  know  of  any  such  contract  upon  your  road  at  all  ?  A. 
No,  sir. 

Q.  You  charge  all  men  alike,  whether  they  are  friends  or  foes? 
A.  Yes,  sir.  If  an  agent  has  a  grudge  against  anybody,  and  he  lets 
us  know  that  he  has  not  been  properly  treated,  we  will  discharge  the 
agent. 

Q,.  Do  you  discriminate  in  any  way  against  shipping.  Do  you 
bind  any  person  by  any  contract  not  to  ship  by  water?  A.  No — not 
even  upon  our  competitive  points  where  there  is  water.  We  are  in 
fact  carrying  freight  so  low  that  we  leave  a  car,  and  they  put  the  goods 

9b 


130 

in  it  themselves,  and  we  take  it  back.  I  don't  know  whether  they 
also  ship  by  water.  If  they  do  we  go  to  them  and  offer  them  induce- 
ments to  ship  with  us.  Sometimes  they  ship  one  time  by  water,  and 
then  come  back  to  us. 

Q.  Have  you  anjr  knowledge  of  the  special  contracts  in  force  upon 
the  Central  Pacific  Railroad?  A.  I  never  saw  one  or  heard  of  one 
being  in  anybody's  possession  that  I  know  of. 

Q.  Is  there  anything  on  page  two  that  is  not  satisfactory  to  you 
(reading  it),  "  without  preference,"  etc.?  A.  There  would  be  a  half  a 
dozen  teams  all  coming  up  at  once — one  five  minutes  ahead  of  the 
other — and  of  two  or  three  different  kinds  of  goods;  and  we  take 
them  and  put  them  in  the  cars,  and  then  take  the  others  next;  but 
this  would  enable  people  to  make  trouble  for  us. 

Q.  You  would  amend  that  so  that  it  would  read,  "  without  un- 
reasonable delay  or  preference?"     A.  Yes,  sir. 

Q.  Do  you  think  that  would  avoid  the  difficulty  in  that  portion  of 
the  section?  A.  I  think  it  would,  except  in  cases  where  a  man  had 
received  a  large  lot  of  wheat,  five  thousand  tons,  and  a  small  farmer 
comes  in  with  ten  or  thirty  tons.  If  the  first  one  demands  the  cars, 
the  other  has  got  to  go  to  the  warehouse,  and  we  will  not  be  able  to 
send  it  till  the  man  who  makes  the  large  shipment  gets  through  with 
his  demand  upon  the  road. 

Q.  How  would  you  amend  that  ?  A.  It  would  be  difficult  to  word 
an  amendment  to  that. 

Q.  How  would  you  say ?  A.  I  would  say,  "with  reasonable  dis- 
crimination, or  without  unreasonable  discrimination  ;  "  but  the  word 
"  discrimination  "  carries  so  many  points  that  I  don't  know. 

Q.  Would  not  that  do  away  with  the  very  object  of  this  bill?  A. 
No,  sir. 

Q  Is  there  anything  in  section  two  to  which  you  have  any  objec- 
tion ?  A.  The  words  "  or  any  part  thereof "  should  be  stricken  out, 
because  if  you  say  that  you  shall  not  discriminate  in  favor  of  one 
person  over  another,  that  carries  that.  If  you  leave  that  in,  it 
would  make  a  maximum  rate  out  of  the  present  minimum  rate, 
and  it  refers  to  that  "as  provided  in  section  one  hereof."  The  result 
of  tftat  clause  would  be  that  in  about  two  years  the  large  railroads 
would  own  all  the  other  small  ones,  because  they  are  the  only  owners 
who  could  operate  them. 

Q.  Is  there  any  other  portion  of  section  two  that  you  specially 
object  to  besides  that?  A.  I  would  like  to  go  back  to  section  one  and 
say  that  this  which  applies  to  a  "preference  to  one  over  another" 
would  prevent  all  return  rates,  or  picnic  parties  and  commutation 
tickets,  and  make  us  carry  our  passengers  at  the  minimum  passenger 
rates. 

Q.  Is  there  anything  in  that  section  of  the  bill  that  you  wish  to 
make  remarks  about,  or  in  sections  three,  four,  five,  and  six?  A.  Sec- 
tion three,  as  I  understand  it,  forces  us  to  keep  up  track  that  we  want 
to  abandon.  There  is  the  Northern  Pacific  Coast  Railroad.  They 
have  gone  to  an  expense  of  two  hundred  thousand  dollars  to  shorten 
their  line  and  to  avoid  heavy  grades,  and  by  doing  so  they  have  been 
obliged  to  abandon  about  two  miles  of  road.     It  is  true  that  those 


131 

two  miles  of  road  run  over  a  pretty  good  property  and  that  they  are 
maintaining  that  road,  but  there  are  on  it  two  very  expensive  high 
trestles.  They  want  to  avoid  them  for  the  safety  of  the  people, 
because  we  all  understand  that  if  an  accident  occurred  on  one  of 
those  trestles  it  would  cause  a  loss  of  life,  and  loss  of  value  almost 
enough  to  forfeit  the  whole  road.  We  would  be  obliged  to  operate 
that,  under  this  section,  the  same  as  heretofore. 

Q.  Do  you  object  to  this:  "All  railroad  corporations  shall  at  all 
times  maintain  all  their  track  and  other  structures  in  good  and  suffi- 
cient repair?"     A.  Self-interest  makes  us  do  it  anyhow. 

Q.  Is  there  anything  objectionable  in  that  sentence?  A.  The 
whole  sentence  is  objectionable. 

Q.  You  heard  the  statement  of  Mr.  Rideout,  of  the  Marysville  road  ? 
A.  Yes,  sir. 

Q.  Did  you  notice  that  he  said  that  sentence  was  not  objectionable, 
and  that  the  only  part  he  objected  to  was  the  latter  portion?  A.  The 
last  part  of  that  says  that  they  shall  keep  the  "track."  Now,  you 
might  construct  a  track  two  miles  to  get  out  some  wood,  and  after  it 
was  out  there  might  be  nothing  left  there.  Now,  under  this,  \7ou 
would  have  to  maintain  that  track  "for  the  purposes  for  which  it" 
was  constructed. 

Q.  Supposing  there  was  an  amendment  put  in  there,  "necessary 
for  the  operation  of  the  road;"  would  that  obviate  your  objections? 
A.  Certainly,  because  we  do  that  now. 

Q.  Do  sections  four,  five,  or  six  specially  affect  you  (reading  section 
four)?     A.  That  don't  affect  us. 

Q.  Section  five;  does  that  affect  you?  A.  Yes,  sir.  Our  working 
company  consists  of  three  corporations,  consolidated,  and  under  that 
section  the  youngest  or  last  constructed  corporation  would  lose  its 
charter  at  the  expiration  of  the  first  constructed.  It  is  some  ten  or 
twelve  years  ahead  of  it,  and  virtually  says  that  the  laws  of  the  State 
cut  off  that  twelve  years. 

Q.  That  is  your  construction  of  it.  Have  you  been  legally  advised 
about  it?  A.  No  ;  I  had  construed  it  myself;  and  then  I  went  to  a 
lawyer  and  asked  him  if  that  wasn't  so. 

Q.  And  he  agreed  with  you?     A.  Yes,  sir. 

Q.  Is  there  any  other  section  of  this  bill  to  which  you  have  objec- 
tion ?  A.  Sections  six  and  seven  are  a  vii'tual  forfeiture  of  the  road 
for  any  small  acts  of  discrimination  that  may  be  practiced.  Section 
six  makes  it  the  same  as  a  turnpike  road.  It  ought  to  be  omitted. 
Section  seven  makes  the  railroad  companies  liable  for  the  act  of  any 
agent,  no  matter  whether  they  are  cognizant  of  his  acts  or  not,  and 
whether  they  authorize  the  acts  or  not  they  forfeit  their  road.  But 
that  can  be  amended  by  saying,  "That  if  the  Board  of  Directors  of  a 
railroad  company  ratify  the  discrimination  or  unjust  act  of  its  agent 
or  agents,  then  they  shall  be  guilty;"  but  not  forfeiture. 

Q.  You  would,  then,  object  to  forfeiture  of  a  road  for  any  purpose? 
A.  Certainly. 

Q.  What  would  you  suggest — imprisonment  of  the  Directors,  by 
confinement  in  the  county  jail  for  one  hundred  days,  in  case  they 
are  found  guilty  of  any  discrimination?     A.  I  would  suggest  that 


132 

they  be  convicted  of  a  misdemeanor  in  the  Courts,  and  adjudged  the 
punishment  that  would  be  given  'them  by  the  Court. 

Q,  You  would  insist  on  having  some  penalty?    A.  Certainly. 

Q.  Would  this  bill,  with  these  amendments  which  you  have  sug- 
gested, benefit  the  people  of  the  State  of  California?  A.  Leave  out 
sections  four,  five,  and  six,  and  take  out  the  forfeiture  clause. 

Q.  No ;  we  do  not  want  to  leave  out  any  section  at  all  ?  A.  No  ;  I 
don't  think  so. 

Q.  You  do  not  think  it  would  be  a  good  bill  ?  A.  Not  if  you  leave 
in  sections  four,  five,  and  six. 

Q.  I  understood  you  to  say  that  section  four  did  not  affect  you? 
A.  It  does  not  affect  us,  but  it  does  the  State. 

Q.  Section  six  you  decidedly  object  to,  on  account  of  the  forfeiture  ? 
A.  Yes,  sir.  Our  railroad  is  a  private  corporation,  built  by  private 
capital,  and  the  stock  is  not  in  the  market.  It  has  always  been  held 
by  my  father,  and  we  have  just  finished  nine  miles  of  road,  from 
which  we  are  not  going  to  get  any  special  returns,  and  it  will  cost  us 
$800,000.  We  are  forced  to  do  it,  in  order  to  save  our  property. 
When  we  are  through,  it  will  cost  us  in  round  numbers  a  million  of 
dollars.  What  benefit  do  we  get  from  that?  None  in  the  world.  We 
have  got  to  spend  money  to  keep  an  outlet  to  the  Bay  of  San  Fran- 
cisco, and  from  competitive  roads  trying  to  kill  us.  We  want  to  take 
our  road  up  to  Eureka,  and  we  have  a  survey  already  made,  but  we 
cannot  do  it  alone  ;  that  is  out  of  the  question.  If  this  section  passes, 
we  will  not  be  able  to  get  money  for  our  bonds.  This  is  a  fine 
country,  and  Has  settling  up  fast.  There  is  no  better  country  in  the 
State.  If  we  run  our  road  up  there,  that  whole  portion  of  the  State 
will  be  populated  and  be  brought  into  close  connection  with  us.  My 
father  has  often  expressed  himself  as  sorry  that  he  did  not  sell  out 
when  Villard  tried  to  buy  him. 

Q.  How  much  did  Villard  offer?     A.  I  do  not  know. 

Qr.  Have  you  read  the  Constitution  in  reference  to  the  railroad 
corporations?     A.  I  have  read  portions  of  it. 

Q.  You  are  satisfied  with  our  Constitution,  are  you  not?  A.  I  will 
not  answer  that,  because  I  have  not  studied  it  sufficiently  to  know 
that  I  am. 

Q.  Is  it  not  a  very  good  character  of  law?    A.  For  the  public, yes. 

Q.  And  also  for  the  common  carrier.  Don't  you  think  so?  A.  I 
am  not  able  to  answer  that. 

Q.  What  does  your  road  pay  per  mile  net  results?  A.  I  do  not 
know  the  figures. 

Q,  Is  it  a  paying  road  ?  A.  It  would  pay  some  profit,  but  is  not 
paying  a  reasonable  profit  on  the  investment;  we  have  never  declared 
a  dividend.  Every  dollar  that  we  got  we  put  right  back  into  the 
road  and  back  into  the  county.  We  have  not  taken  a  dollar  outside; 
it  has  been  paid  to  the  people  in  the  county  where  we  have  employed 
them. 

Q.  Have  you  been  operating  this  road  at  a  loss  ?  A.  Some  portions 
of  it. 

Q.  As  a  whole?     A.  No. 

Q.  In  other  words,  you  have  made  money  out  of  it  which  you  have 


133 

placed  in  again  in  building  it  up?  A.  Yes,  sir ;  but  we  have  not  had 
a  reasonable  compensation  for  the  money  invested,  by  any  means. 

Q.  You  say  that  you  did  not  receive  a  subsidy  from  Sonoma 
County?     A.  Not  a  dollar. 

Q.  Do  you  not  know  as  a  fact  that  Sonoma  County  has  been  pay- 
ing taxes  upon  those  railroad  bonds?  A.  I  know  it  from  hearsay; 
I  never  saw  one  of  them,  or  the  accounts,  or  books  of  record. 

Senator  Kellogg — I  understood  you  to  say  that  the  author  of 
the  bill  informed  you  that  the  object  of  it  was  to  allow  railroads  to 
charge  the  same  price  per  ton  per  mile  on  long  and  short  hauls? 
A.  Yes,  sir;  I  asked  him  yesterday  afternoon  in  front  of  the  Golden 
Eagle  Hotel. 

Q.  Would  not  such  a  rule  prevent  the  farmers  in  the  interior  from 
competing  with  those  nearer  the  seaboard?  A.  Yes,  sir;  it  would  be 
impossible  to  compete. 

Senator  McClure — I  ask  you  to  look  at  the  bill,  and  see  whether 
this  would  meet  your  ideas:  "All  freight  of  the  same  class  or  kind 
shall  be  dispatched  and  forwarded  as  near  as  may  be  in  the  order  in 
which  it  is  received."  Would  that  cover  your  objection?  A.  Sup- 
posing that  you  had  freight  for  a  half  a  dozen  cars  at  each  station 
and  you  haven't  got  them  there.  You  may  have  three  cars,  and  you 
distribute  them  as  near  as  you  can.  Sometimes,  then,  it  would  hap- 
pen that  you  would  have  to  keep  the  stuff  in  the  yard  two  or  three 
weeks,  or  let  it  go  by.  We  can't  do  that.  If  a.  man  offers  us  freight 
we  have  got  to  take  it.  We  have  got  to  unload  it,  and  under  this  law, 
in  that  case,  we  would  have  to  furnish  him  storage  as  well  as  any- 
body else. 

Senator  Spencer — Have  you  not  a  competing  railroad  connected 
with  the  water  traffic?     A.  Yes,  sir. 

Q.  What  is  the  name  of  that?  A.  Our  road  is  a  competing  road, 
connected  with  the  water  line. 

Q.  The  waterline  runs  up  to  Petaluma,  and  from  there  the  road 
runs  up  to  Duncan's  Mills?  A.  That  is  the  North  Pacific  Coast  Rail- 
road. That  will  be  a  competing  line  in  about  two  weeks.  It  starts 
from  Saucelito. 

Q.  It  runs  from  San  Rafael  now?    A.  It  runs  through  San  Rafael. 

Q.  It  runs  from  San  Quentin?  A.  From  Saucelito  to  Duncan's 
Mills — that  is,  about  sixteen  miles. 

Q.  How  far  is  it  from  Petaluma  to  San  Francisco?  A.  The  way 
that  we  have  been  running,  it  is  forty-two  miles. 

Q.  What  do  you  charge  on  that  road?     A.  One  dollar. 

Q.  You  charge  one  dollar  and  a  half  for  forty  miles,  and  one  dollar 
for  fifteen?    A.  That  is  water  competition. 

Q.  Where  the  water  is  in  competition,  you  drop  the  rate?  A.  Yes, 
sir;  but  we  have  got  competition. 

Q.  From  Petaluma  up  you  have  it  all  your  own  way?  A.  No,  sir: 
we  have  not. 

Q.  Up  to  Healdsburg,  Cloverdale,  and  Guerneville?  A.  I  refer 
you  to  the  testimony  before  the  Railroad  Commission  on  that 
subject. 

Q.  That  road  is  about  fifteen  miles  long?     A.  Yes,  sir. 


134 

Q.  Did  not  the  citizens  of  the  county  help  to  build  that  road.  Did 
they  not  subscribe  a  large  amount  to  build  that  road  ?  A.  Not  to  my 
knowledge.  They  did  not  subscribe  a  dollar.  They  may  have  given 
one  or  two  rights  of  way. 

Q.  Do  you  mean  additional  to  the  stock? 

Senator  Cross — Either?    A.  Not  to  my  knowledge. 

Q.  Has  your  road  a  bonded  indebtedness  outside  of  the  county? 
A.  No,  sir. 

Q.  Your  father  and  yourself  are  the  exclusive  owners  of  that  road? 
A.  Yes,  sir. 

Q.  Do  you  know  the  cost  of  running  that  road  last  year?  A.  No, 
sir;  I  do  not. 

Q.  Do  you  not  know  as  a  matter  of  fact  that  it  is  one  of  the  best 
paying  roads  in  this  State?    A.  No,  sir;  I  do  not. 

Q.  If  you  do  not  know  the  cost  of  running  it,  how  do  you  know 
that  it  is  not  one  of  the  best  paying  roads  in  the  State  ?  A.  If  I  did 
know,  and  knew  the  cost  of  running  the  others,  I  might  answer  it. 

Q.  Where  you  have  water  competition  do  you  make  the  same  pro- 
portional charge?    A.  I  could  not  tell  you,  I  never  figured  it  out. 

Q.  You  say  that  you  have  but  four  classes  on  your  road  ?  A.  There 
are  four  classes,  I  think ;  articles  that  are  to  be  shipped  in  a  car  in 
bulk,  such  as  live  stock  and  wheat,  and  lumber,  redwood,  and  stuff 
of  that  kind.  Then  we  have  one,  two,  three,  and  four — and  A,  B,  C, 
and  D. 

Q.  Do  you  know  what  class  of  articles  go  into  class  one?  A.  I  do  not 
know,  because  we  have  just  changed  class  one,  and  we  were  figuring 
on  making  it  class  four,  to  help  the  people  out  in  understanding  the 
matter. 

Q.  A  man  that  is  not  a  railroad  man  cannot  understand  these  mat- 
ters anyway,  can  he?    A.  Not  unless  it  is  explained  to  him. 

Q.  He  has  to  have  a  mathematical  expert  by  him  all  the  time, 
does  he  not?  A.  No,  sir;  all  that  he  needs  is  to  have  one  or  two 
explanations  made  to  arrive  at  them.  Like  a.  man  taking  up  a  rail- 
road time-table,  a  stranger  that  don't  know  anything  about  it,  if  you 
explain  it,  he  understands  it.  It  don't  take  more  than  three  or  four 
days  for  an  agent  to  understand  our  tariff. 

Q.  You  only  have  about  four  or  five  different  classes  of  freight? 
A.  As  far  as  my  limited  knowledge  of  the  freight  department  goes, 
that  is  all. 

Q.  Do  you  discriminate  between  persons  and  places  on  your  road? 
That  is,  do  you  permit  one  person  to  ship  cheaper,  on  account  of  the 
greatness  of  his  trade  or  transportations?  A.  No,  sir;  not  to  my 
knowledge. 

Q.  The  branch  of  the  road  that  was  built  to  Guerneville  Avas  built 
out  of  the  earnings  of  the  road?  A.  My  understanding  is  that  the 
greatest  portion  of  that  was  taken  out  of  my  father's  private  business, 
outside  of  the  railroad. 

Q.  Isn't  it  a  fact,  that  the  extension  was  built  out  of  the  dividends 
of  the  main  line  ?  A.  Yes,  sir;  what  was  made  was  applied  to  that, 
but  we  have  taken  also  a  great  deal  of  money  that  was  made  outside 
from  private  capital. 


135 

Q.  Had  you  not  expended  that  on  the  building  of  the  extension, 
you  would  have  had  a  dividend  on  the  road  originally  made?  A. 
No,  sir. 

Q.  Why  not?     A.  Because  we  would  have  had  a  parallel  road. 

Q.  You  mean  that  you  would  have  had  competition?  A.  On  one 
portion  of  the  road,  we  have  now.  I  think  that  they  built  it  to  sell 
to  us,  and  we  had  to  take  it.  We  never  would  have  constructed  it 
ourselves.  We  have  a  narrow-gauge  on  that  twenty-two  miles  that 
was  built  expressly  to  sell  to  us.  They  forced  us  to  buy  it.  We  run 
a  steamer  a  third  of  the  distance,  and  we  have  run  as  much  as $8,000 
short.  Now  we  have  to  run  the  boat.  The  whole  freights  of  that 
part  of  the  line  won't  pay  steamer  expenses.  They  are  a  loss  to  us  of 
$100,000. 

Senator  Sullivan — Why  do  you  run  the  steamer?  A.  Because 
they  built  a  road  parallel  to  ours,  and  did  it  in  such  a  way  that  it 
would  affect  us,  and  would  hurt  us,  and  take  half  our  travel  away 
from  our  road. 

Q.  Then  you  are  running  this  steamer  to  break  up  competition? 
A.  Not  to  break  up  competition,  but  to  do  a  double  business,  and  to 
carry  the  business  up  to  the  Donahue  Landing.  We  deliver  the 
freight  there,  and  it  is  actually  at  a  loss,  but  the  property  is  there  and 
we  hope  some  day  or  another  it  will  pay  us. 

Senator  Kellogg — And  to  accommodate  the  people?  A.  Yes, 
sir;  and  we  hope,  that  in  the  next  year  or  two,  the  country  will 
develop  sufficiently  to  pay  us. 

Senator  Sullivan — I  understood  you  to  say  that  it  was  for  the 
purpose  of  preventing  the  competition  of  a  parallel  line?  A.  We 
have  bought  it,  and  we  have  got  to  run  it  now.  If  we  don't,  some- 
body else  will.     That  is  one  of  the  difficulties  in  railroading. 

Q.  Was  your  construction  of  this  bill  put  upon  it  by  your  legal 
advisers?    A.  No,  sir. 

Senator  Vrooman — What  facilities  wfere  offered  for  travel,  on  the 
first  day  of  January,  1884,  between  Donahue's  Landing  and  Peta- 
luma?  A.  We  were  offering  one  fast  train  and  the  accommodation. 
We  were  running  one  train  through  and  back.  We  were  doubling 
the  road. 

Q.  When  this  through  line  is  completed,  will  you  still  continue 
running  that  train  for  passenger  travel?    A.  No;  we  cannot  do  it. 

Q.  You  will  not  be  allowed  to  discontinue  it  under  the  last  part  of 
section  one  of  this  bill?    A.  No,  sir;  we  are  not. 

Q,.  Have  you  compared  the  fares  and  freights  over  your  line  with 
other  lines  in  this  State?     A.  No;  sir. 

Q.  So  you  do  not  know  whether  your  fares  and  freights  are  lower 
than  others?  A.  In. some  instances  they  are' higher  and  in  some 
thejr  are  lower. 

Q.  In  what  particular?  A.  I  cannot  say,  I  will  have  to  refer  you 
to  the  tariff  to  compare  it  with  other  roads  ;  still,  I  know  that  to  be 
the  case. 

Q.  How  is  the  general  tariff  on  a  commodity  fixed?  A.  I  can't 
say.  I  have  not  seen  the  original  in  years  ;  it  is  not  as  it  was  origi- 
nally fixed. 


136 

Q.  Will  it  not  fix  itself  after  awhile?    A.  It  fixes  itself  now. 

Q.  In  other  words,  the  freight  is  coming  down  every  day?  A. 
Yes,  sir;  in  fact  we  are  making  a  new  tariff  to-day  in  which  we  have 
reduced  it  fifteen  to  twenty  per  cent,  all  freighting  above  Healds- 
burg.     Our  agent  has  been  working  at  it  now  for  three  months. 

Senator  Whitney — Is  it  not  to  the  interest  of  the  railroad  com- 
panies to  reduce  freights  as  fast  as  they  can  ?  A.  If  by  reducing  they 
can  increase  the  volume  of  their  business,  it  is  for  their  interest  to  do 
so.  They  never  fail  to  increase  it  when  they  can,  and  that  is  a  benefit 
to  the  producer. 

Q.  The  interest  of  the  railroad  company  and  that  of  the  people 
would  be  identical  in  that  respect?  A.  If  they  do  not  work  in  har- 
mony they  will  never  get  along.  They  are  both  losers  by  it;  a  lib- 
eral policy  will  make  more  money  for  the  people,  and  make  more 
money  for  all.     That  is  what  we  are  aiming  at. 

Senator  Spencer — You  say  that  the  interests  of  the  people  are 
the  interests  of  the  railroad,  and  you  think  they  ought  to  be  harmo- 
nious. Isn't  it  a  fact  that  it  turned  out  on  the  investigation  at  Santa 
Rosa,  that  the  merchants  shipped  their  goods  by  Healdsburg,  and  by 
so  doing  they  were  delivered  both  in  and  at  San  Francisco,  at  a  com- 
paratively small  price,  and  that  the  railroads  put  it  up  higher  and 
they  had  to  pay  it  ?  A.  That  took  place  about  a  year  ago,  and.  not 
as  you  state  it. 

Q.  Give  us  the  statement  of  how  it  was  done?  A.  I  don't  know 
the  particulars  of  that,  but  Wells,  Fargo  &  Co.  began  to  play  a  little 
opposition  on  our  road.  It  was  unknown  to  us,  and  we  found  it  out 
and  told  them,  ';  Here,  if  you  are  going  to  carry  perishable  articles 
and  express  matter  on  this  road,  come  out  and  act  squarely  and 
don't  go  behind  us." 

Q.  When  did  you  find  it  out?  A.  Through  an  investigation  of 
a  freight  train  not  over  a  year  ago.  And  to-day  I  believe  Wells,  Fargo 
&  Co.  carry  the  butter  and  eggs  and  poultry,  and  I  think  deliver  them 
in  the  city,  and  it  is  to  the  advantage  of  both  the  shippers  and 
buyers. 

Q.  Was  not  that  developed  at  the  time  the  railroad  went  up  to 
Santa  Rosa?  A.  No,  sir;  there  was  some  discussion  on  that,  but  that 
was  later.     I  forget  what  it  was. 

Q.  A  merchant  was  shipping  eggs  at  fifty  cents  a  box  by  Wells, 
Fargo  &  Company,  for  them  to  deliver  in  San  Francisco?  A.  I 
don't  know  the  figures,  but  to  show  you  the  absurdity  of  that,  the 
railroad  company  had  never  at  any  time  handled  a  box  of  eggs,  or 
butter,  or  anything  else,  because  they  wanted  them  to  have  it. 

Q.  Didn't  it  cost  them  twice  as  much  afterwards  to  ship  it  by 
Wells,  Fargo  &  Company?  A.  No,  sir;  not  to  my  knowledge. 
What  you  refer  to  took  place  over  a  year  and  a  half  ago. 

Senator  Vrooman — Is  there  any  stations  between  Donahue  and 
Petaluma  of  any  kind?     A.  No,  sir;  there  is  a  junction,  that  is  all. 

Q.  After  you  get  your  new  line  done  will  the  people  of  Petaluma 
have  as  good  accommodations  as  by  the  other  way?  A.  They  will 
from  San  Francisco,  by  way  of  San  Rafael,  by  an  hour  and  forty 
minutes. 


137 

Q.  That  would  be  much  better  for  the  people  of  Petaluma  than 
the  present  route?  A.  It  gives  them  nearly  three  hours  and  a  half 
longer  in  the  city. 

Q,  If  the  road  from  Donahue  to  Petaluma  is  discontinued,  would 
any  portion  of  the  community  suffer  in  any  way,  shape,  manner,  or 
form.  Would  it  be  any  detriment  to  the  community  if  you  should 
take  the  other  line  up  ?  A.  No,  it  would  not,  because  there  is  no 
travel  between  Petaluma  and  Donahue. 

Q.  If  you  were  compelled  to  run  the  read  the  same  as  it  was  on  the 
first  day  of  January,  eighteen  hundred  and  eighty-four,  you  would 
be  subjecting  the  company  to  very  great  expense  without  a  corre- 
sponding benefit  to  the  people?     A.  Certainly. 

Senator  Sullivan — Do  you  understand  that  "  equal  and  similar 
facilities  "  mean  what  the  Senator  from  Alameda  says  they  do.  Don't 
it  mean  that  you  shall  run  a  passenger  car  of  the  same  quality  as  you 
do  now,  of  the  same  kind  and  size,  and  furnished  in  the  same  man- 
ner ?  A.  It  don't  go,  that  particular  part  of  it;  but  it  could  be  so 
construed. 

Q.  It  is  the  most  extreme  view?     A.  It  is  the  view  I  take. 

Q.  "  Equal  and  similar."  You  have  a  certain  kind  of  car  in  which 
you  send  express  matter,  or  furniture,  or  things  of  that  kind  ?  A.  We 
have  box  and  flat  cars. 

Q.  Does  not  this  mean  that  you  shall  not  .put  matter,  like  furni- 
ture or  something  that  would  receive  injury,  on  an  open  car,  but 
that  you  shalhput  it  in  a  box  car?  A.  That  is  the  custom  of  rail- 
roads.    They  make  us  do  that  anyhow. 

Q.  Does  it  not  mean  that  you  shall  place  articles  in  cars  fitted  to 
carry  them?  A.  If  it  don't  say  "heretofore,"  it  means  so  certainly. 
For  we  have  always  got  box  cars  for  certain  classes  of  goods.  We 
can't  be  compelled  to  do  so  hereafter,  because  we  were  doing  so 
before. 

Senator  Cross — You  say  that  there  are  four  classes  of  freight, 
and  some  sub-classes?  A.  We  have  got  what  we  call  general  mer- 
chandise stuff,  of  four  classifications,  and  then  there  are,  I  believe, 
three  or  four  that  run  a  little  beyond  the  classification.  We  have 
A,  B,  C,  and  D,  and  one,  two,  three,  and  four,  and  then  carload  lots. 
Wheat,  for  instance,  is  very  low,  the  farmers  can't  afford  much.  We 
have  cars  lying  idle  and  can't  afford  it,  so  we  cut  the  freight  down 
a  half  a  cent,  that  puts  it  into  another  class,  may  be,  but  the  classi- 
fication is  made  on  all  kinds  of  merchandise. 

Q.  What  is  the  basis  of  charges  on  your  roads?  A.  The  classifica- 
tion: they  have  the  name  of  nearly  every  kind  of  freight  shipped 
or  handled  arranged  alphabetically.  A  shipper  comes  down  to  the 
station,  a  shipping  merchant,  for  instance,  and  the  agent  shows  him 
the  rates,  class  two,  so  much;  he  has  perhaps  a  bundle  of  silk,  class 
one,  so  much.  It  is  to  facilitate  the  charges.  Of  course,  we  have  to 
have  classification,  because  if  you  take  an  article  of  freight  that  there 
is  no  danger  of  breaking,  you  can  handle  it  in  half  of  the  time  that 
you  could  a  sewing  machine  in  putting  it  into  the  car. 

Q.  On  the  classification  you  base  your  rates  of  charges?  A.  Yes, 
sir. 


138 

Q.  Suppose  that  you  were  compelled  to  charge  one  uniform  price 
for  all  classes  of  freight,  what  would  the  result  be  upon  the  prices 
that  would  have  to  be  charged  upon  the  shipment  of  the  main  pro- 
ducts of  the  country?  A.  We  wouldn't  ship  any,  unless  we  took 
our  minimum  as  it  is  at  present.     It  is  a  loss  to  us. 

Q.  Suppose  that  you  were  to  make  an  average  rate  of  all,  what 
would  be  the  price  necessarily  charged  in  shipping  the  great  pro- 
ducts of  the  country,  such  as  wheat,  or  live  stock?  A.  It  would  be 
an  injury;  you  couldn't  ship  it  at  all. 

Q.  If  they  were  to  be  shipped,  what  would  be  the  prices  that  you 
would  be  compelled  to  charge?  A.  Close  to  the  water  they  are  at  a 
minimum  now.     It  would  make  very  little  difference  there. 

Q.  Suppose  that  your  road,  instead  of  being  a  hundred  miles  in 
length,  was  some  thousands  of  miles,  reaching  to  all  the  principal 
cities,  and  carrying  goods  to  all  parts  of  the  United  States,  do  you 
think  that  any  other  classifications  would  be  necessary  than  those 
which  you  have?  A.  The  further  wre  went  the  less  per  mile  we  would 
make  on  bulky  articles. 

Q.  Do  you  think  that  any  further  classification  wrould  be  necessary 
under  those  circumstances  than  that  which  you  now  have?  A.  I 
could  not  answer  that,  because  I  have  not  examined  the  classification 
lately.     I  naturally  suppose  so. 

Q.  By  whom  is  the  forwarding  of  freight  attended  to  on  the  line  at 
the  different  stations?     A.  By  the  agent  in  charge. 

Q.  He  is  the  man  who  sees  that  freight  is  put  into  the  cars  and 
sent  forward  ?     A.  Yes,  sir. 

Q.  And  it  is  in  his  hands,  if  it  is  in  anybody's  hands,  to  discriminate? 
A.  Yes,  sir;  altogether.  He  could  make  us  have  our  road  forfeited 
at  any  time  if  he  wanted  to. 

Q.  Do  you  think  it  possible  that  you  could  always  have  at  those 
stations  agents  upon  whom  you  could  rely  in  such  matters?  A.  No, 
sir;  we  could  not.  Suppose  that  we  authorized  an  agent  to  have 
charge  of  our  station  and  of  all  our  freight,  and  that  he  appoints  a 
sub-agent.  Another  company  could  come  to  our  authorized  agent  and 
with  a  little  matter  of  a  hundred  or  two  hundred  thousand  dollars 
(and  he  would  go  to  jail  six  months  mighty  quick  for  it),  and  his  act 
could  make  us  forfeit  our  road  and  wre  would  not  know  anything 
about  it.     He  could  fix  up  the  job  at  any  time  that  he  w7anted  to. 

Q.  Then  the  property,  instead  of  vesting  in  the  owners  of  the  road, 
vests  in  the  hands  of  each  particular  agent?  A.  Yes,  sir;  that 
clause  should  be:  "If  the  Board  of  Directors  sustain,  or  ratify,  or 
authorize  the  station  agent."  Then  the  Directors  would  be  respon- 
sible for  the  commission  of  these  acts. 

Q.  Do  you  think  that  a  personal  penalty  inflicted  on  the  represen- 
tative of  the  road  would  be  sufficient?  A.  I  think  it  would  be  more 
than  sufficient.  The  penalty  should  be  on  the  person  who  author- 
izes the  act.     If  the  representative  of  the  road,  then  let  it  be  him. 

Q.  Do  you  think  that  would  be  sufficient  to  compel  a  compliance 
witli  the  law?    A.  I  should  think  so. 

Q.  Do  you  think  that  the  people  who  conduct  the  railroad  or  the 
company  should  be  held  responsible  for  the  acts  of  the  agents?  A. 
That  question  would  require  a  little  explanation. 


139 

Q.  If  the  railroad  company  could  always  say  that  it  was  the  em- 
ployes that  disobeyed  the  law,  then  the  railroad  company  would 
always  avoid  the  penalty  and  the  liability?  A.  Of  course.  If  they 
could  always  avoid  it,  the  agent  could  always  keep  on  doing  that. 
Now,  if  you  would  put  the,  penalty  very  heavy  for  the  first  offense, 
mister  agent  wouldn't  do  it  any  more. 

Q.  If  you  put  it  entirely  upon  the  agent,  it  would  not  be  proper  to 
say  that  the  company  were  responsible  at  all,  even  if  they  did  cause 
the  agent  to  do  it?  A.  That  would  be  wrong.  We  want  to  see  the 
agent  punished. 

Q.  Wouldn't  the  company  always  say  that  they  never  authorized 
the  agent  to  do  it?  A.  Suppose  they  did  say  that;  then  we  have  got 
the  agent  to  punish  ;  he  did  it,  didn't  he? 

Q.  Yes,  sir.     A.  Well,  punish  him,  then. 

Q.  You  would  not  forfeit  your  charter  for  any  act  of  his.  Do  jrou 
know  that  when  an  agent  does  any  act  out  of  malice,  or  out  of  the 
scope  of  his  authority,  that  the  company  would  not  be  responsible 
for  his  act  in  any  sense  of  the  word  ?  A.  No  doubt,  but  under  this 
bill  he  would  be. 

Q.  If  he  is  an  engineer,  and  running  on  the  road,  and  willfully  and 
maliciously  runs  over  a  man,  he  is  responsible?  A.  Yes,  sir; 
according  to  law. 

Q.  Do  you  think  the  company  would  be  responsible  in  that  case 
for  his  act?  A.  In  Court — I  don't  think  any  Court  would  deliber- 
ately hold  him  responsible. 

Q.  I  have  asked  all  these  questions  simply  for  the  purpose  of  show- 
ing that  they  are  not  proper  questions  to  be  put. 


Statement  of  Me.  W.  N.  Hawley. 

Senator  McClure — What  is  your  business?  Answer — The  hard- 
ware and  mercantile. 

Q.  Where  do  3^011  conduct  your  business?  A.  On  Market  Street, 
San  Francisco,  under  the  firm  name  of  Hawley  Brothers. 

Q.  How  long  have  you  been  engaged  as  importers  of  hardware? 
A.  Nearly  thirty  years. 

Q.  How  do  you  import  your  goods?  A.  At  the  present  time, 
entirely  by  rail. 

Q.  How  long  have  you  been  importing  your  goods  by  rail?  A.  I 
think  about  two  years;  that  is,  consecutively.  I  dropped  out  two 
years,  and  then  for  four  years  I  carried  entirely  by  rail,  making 
about  six  years  altogether. 

Q.  To  what  extent  do  you  import  goods— great  or  small?  A.  Our 
freight  bills  amount  to  $200,000  a  year. 

Q.  You  are  acquainted  with  a  great  many  of  the  merchants  of  San 
Francisco?     A.  Yes,  sir. 

Q.  You  import  goods  by  the  Central  Pacific  Railroad  Company? 
A.  Yes,  sir. 

Q.  Are  you  acquainted  with  the  special  contract  system  ?  A. 
Somewhat  so. 


140 

Q.  Do  you  import  your  goods  under  a  special  contract?  A.  So  I 
understand. 

Q.  AVill  you  please  state  to  this  committee  anything  that  you 
know  about  the  special  contract  system,  and  as  to  whether  you  have 
any  objection  to  it,  and  the  effect  which,  it  has  upon  the  business 
community  of  San  Francisco?  A.  At  the  present  time  we  have 
only  a  verbal  contract.  It  is  a  verbal  continuation  of  the  old  con- 
tract, with  some  few  modifications.  We  have  been  running  under  it 
and  the  modifications  for  about  six  years.  In  the  first  place,  Mr. 
Stubbs  made  the  first  special  contract  with  myself  for  all  our  agri- 
cultural goods* about  eight  years  since.  We  tried  it  for  one  year,  and 
after  that  we,  without  any  notice  to  the  railroad  company,  abandoned 
it,  and  shipped  round  Cape  Horn.  After  one  year  shipping  round 
Cape  Horn,  they  made  a  proposition  to  us  to  get  our  freight  back. 
We  told  them  that  we  would  carefully  consider  it,  and  tell  them 
what  we  would  do.  When  Mr.  Stubbs  came  to  us,  he  asked  us,"  What 
can  you  afford  to  pay  the  companj^  to  ship  all  your  goods  overland?" 
We  named  a  certain  figure,  and  told  him  that  we  had  made  careful 
estimates,  and  told  him  what  we  thought  we  ought  to  pay.  We  had 
put  a  man  on  it,  and  he  was  three  months  working  it  up,  and  we  pre- 
sented it  to  him  with  every  article  brought  to  the  State  for  six  months, 
and  showed  him  the  average  of  all  that  business,  and  what  it  cost  by 
water,  and  the  cost  of  insurance  on  the  goods,  and  what  the  cost  was 
of  what  we  had  brought  by  rail  for  six  months. 

Q.  Who  is  Mr.  Stubbs?  A.  The  General  Traffic  Manager  of  the 
Central  Pacific  Railroad  Company. 

Q.  At  the  time  you  were  making  these  estimates  there  were  but 
three  routes — the  overland,  by  the  Panama,  and  round  Cape  Horn — 
and  in  making  your  estimates,  you  took  into  consideration  the  mat- 
ter of  bringing  freight  by  either  of  those  routes,  and  the  question  of 
insurance  and  of  delay?  A.  Yes,  sir;  and  we  also  estimated  by  the 
freight  bills  for  six  months  overland,  and  got  at  the  total  amount  of 
our  freight.  We  then  took  a  special  contract  tariff  and  figured  the 
same  classes  of  goods  under  the  tariff,  and  showed  him  that  if  we 
continued  the  business  of  shipping  overland  under  the  special  con- 
tract for  a  year  we  would  have  a  loss  of  sixty-seven  thousand  dollars, 
and  we  told  him  very  plainly  that  we  would  not  make  a  special  con- 
tract unless  he  reduced  the  rates  to  us. 

Q.  Were  the  rates  subsequently  reduced?  A.  Not  that  year;  no, 
sir.  He  told  us  that  our  figures  were  incorrect;  that  they  were  doc- 
tored for  the  purpose  of  getting  lower  rates  of  freight.  We  submitted 
the  matter,  and  told  him  he  might  go  on  and  prove  whether  we  had 
made  an  error.  He  tried  them  for  about  three  weeks,  and  then  said 
he  had  sent  them  to  the  General  Freight  Agent  of  the  Union  Pacific 
Railroad.  We  told  him  at  that  time  that  our  business  being  with 
the  agricultural  community,  we  had  to  have  contracts  running  at 
certain  seasons  of  the  year.  We  were  not  like  any  other  party,  mak- 
ing a  contract  every  month,  nor  could  we  make  a  contract  from 
January  to  January.  Our  contracts  commenced  in  July  or  August, 
and  they  must  commence  then,  or  we  would  make  no  contract  at  all, 
and  I  told  him  that  on  the  first  day  of  July  we  must  know  what  he 


141 

would  charge.  He  said  he  would  not  accept  it  in  the  first  place.  He 
thought  the  matter  over,  and  sent  the  figures  on  to  Mr.  Vining,  who  at 
that  time  had  the  control  of  the  matter.  Vining  would  not  accept 
of  it.  He  told  me  that  he  did  not  have  a  positive  answer,  but  that 
he  wanted  to  investigate  it.  I  told  him  if  we  didn't  have  a  positive 
answer  on  the  first  of  July  I  would  make  a  contract  to  ship  around 
the  Horn.  We  did  make  a  positive  contract  to  ship  that  way.  He 
came  to  us  two  or  three  days  after  that  to  negotiate  and  we  told  him 
that  we  could  not  negotiate.  We  had  telegraphed  to  New  York  and 
it  was  closed;  that  we  had  entered  into  a  negotiation  for  the  year, 
but  the  next  year,  when  the  time  came  round,  we  would  take  up 
negotiations  again.  The  result  was,  that  we  entered  into  a  new  con- 
tract on  the  first  of  September  to  the  first  of  last  September,  with  the 
privilege,  on  the  first  day  of  July,  of  shipping  around  the  Horn  or 
to  state  our  case  on  sixty  days'  notice. 

Q.  From  year  to  year,  you  had  your  goods  overland?  A.  That 
was  the  year  which  terminated  last  September.  We  had  our  goods 
overland,  and  that  continued  under  a  verbal  contract,  and  we  have 
been  shipping  overland. 

Q.  Was  the  matter  satisfactory  to  you?  A.  We  would  not  have 
entered  into  a  contract  unless  it  was  entirely  satisfactory. 

Q.  Was  there  any  compulsion  at  all?  A.  Not  at  all ;  we  told  him 
we  would  give  certain  figures,  and  when  we  got  the  figures,  that  was 
satisfactory,  and  when  we  bound  ourselves  to  agree  to  it,  we  would 
naturally  stand  by  the  contract. 

Q.  If  it  were  for  your  interest,  could  you  have  gone  on  shipping 
around  the  Horn?  A.  Certainly,  our  contract  gives  us  the  privilege 
of  going  around  the  Horn,  and  whenever  we  see  fit  to  do  so,  we  shall 
certainly  go  around  the  Horn  with  our  freight,  There  is  no  com- 
pulsion of  any  kind  on  one  side  or  the  other.  It  is  a  matter  of  dol- 
lars and  cents  to  us. 

Q.  I  presume  you  have  talked  with  other  merchants,  then?  A. 
Yes,  sir. 

Q.  Do  you  know  of  any  special  complaints  as  to  the  system  from 
the  merchants  of  San  Francisco?  A.  I  do  not,  sir.  There  are  com- 
plaints, but  no  substantial  complaint.  There  is  always  some  growling 
done;  and  the  reason  is,  on  the  part  of  a  good  many  of  them,  that 
they  have  had  contracts  with  the  Central  Pacific  Railroad  Company, 
ami  have  violated  them  and  had  their  contracts  withdrawn,  and 
now  they  are  howling  against  the  railroad  company  and  the  contract 
system. 

Q.  Do  you  regard  these  contracts  as  a  detriment  to  the  commercial 
and  business  community  of  San  Francisco?  A.  I  do  not,  I  claim 
that  since  these  special  contracts  are  allowed  to  be  made,  it  would  be 
a  detriment  to  the  interests  of  San  Francisco,  and  a  very  ureal  detri- 
ment to  the  interests  of  the  Central  Pacific  Railroad  Company,  and 
would  take  from  them,  perhaps,  twenty  million  dollars'  worth  of 
freight  should  they  be  stopped. 

Q.  Do  you  think  any  substantial  gain  would  be  secured  to  the 
people  of  the  State  if  they  were  done  away  with  V  A.  It  is  a  question 
of  dollars  and  cents.     We  want  to  get  our  goods  here  at  the  lowest 


i  142 

possible  rates.  We  can't  compete  with  other  merchants  unless  we 
do,  and  when  the  company  come  to  us  and  give  ns  contracts,  which 
we  think  are  better,  we  accept  of  them;  and  when  we  do,  we  try  to 
live  up  to  them. 

Senator  Del  Valle — Your  business  is  in  the  hardware  line  and 
agricultural  implements?     A.  Yes,  sir. 

Q.  You  have  stated  what  the  bulk  of  your  freight  cost  you  at  a 
certain  .time  of  the  year  ?  A.  Not  the  bulk  of  our  freight.  As  to  that, 
I  may  say  that  the  bulk  of  our  freight  comes  from  March  until  June; 
that  is,  our  agricultural  implements,  and  we  have  to  have  them  right 
at  that  time.  The  other  classes  of  goods  we  can  manage  to  ship 
round  the  Horn,  just  as  well  as  to  make  a  contract  every  month  in 
the  year;  but  on  the  agricultural  implements,  we  want  to  know  what 
we  need,  and  ship  them  from  January  to  December,  around  the 
Horn,  and  get  them  here  at  a  prior  time.  We  would  be  tied  up  if 
we  started  them  after  January  first,  and  have  to  get  them  over  the 
roads. 

Q.  It  is  necessary  to  keep  that  kind  of  implements  in  stock,  is  it? 
A.  Sometimes  it  is  necessary.  I  think  I  have  telegraphed  fifty 
dispatches,  within  the  last  three  months,  for  agricultural  goods. 

Q.  Now,  you  are  necessarily  required  to  keep  them?  A.  Yes,  sir; 
as  I  said  before,  we  can  start  our  agricultural  goods  in  September  or 
November,  and  get  them  here  in  time,  around  the  Horn. 

Q.  Under  the  special  contract  with  the  company,  do  you  have  the 
privilege  of  bringing  goods  around  the  Horn  if  you  desire?  A.  No, 
sir;  our  contract  says  all  our  freight  shall  go  over  the  road. 

Q.  Is  it  the  same  in  the  case  of  other  merchants  in  San  Francisco; 
take,  for  instance,  Murphy,  Grant  &  Co.?  A.  I  couldn't  say;  the 
most  of  their  freight  comes  in  the  Spring  of  the  year.  I  suppose  they 
ship  more  in  March  and  April  than  any  other- months,  and  perhaps 
in  September. 

Q.  From  the  nature  of  the  business,  is  it  not  a  fact  that  they  ship 
freight  at  all  times,  and  that  the  goods  come  at  no  certain  time?  A. 
TUey  ship  every  month  in  the  year.  Our  freight  bills  will  average 
from  fifteen  to  twenty-five  thousand  dollars  every  month  in  the 
year. 

Q.  Do  they  not,  on  account  of  business  principles,  have  to  bring 
their  freight  through  as  quickly  as  possible?  A.  No,  sir;  sometimes 
they  take  six  months  to  bring  them  here. 

Q.  For  houses  that  deal  in  particular  articles,  is  it  not  necessary 
for  them  to  bring  them  from  New  York  as  quick  as  they  can?  A.  I 
think  so.  I  am  not  familiar  with  other  classes  of  business.  When 
they  do,  I  suppose  they  pay  open  tariff. 

Q.  Isn't  it  a  fact,  that  under  those  circumstances,  not  having  the 
facility  to  ship  at  certain  times  of  the  year  when  their  goods  are 
most  needed,  they  are  obliged  to  have  a  special  contract  with  the  rail- 
road company?  A.  No,  sir;  I  don't  think  it  is  necessary  on  the  part 
of  any  merchant  in  San  Francisco  to  have  a  special  contract  with  the 
railroad  company.  I  am  not  so  familiar  with  drygoods  or  groceries 
as  I  am  with  hardware. 

Q.  In  your  business,  you  can  wait  six  months  for  the  goods?  A. 
Yes,  sir. 


143 

Q.  Therefore,  you  can  bring  them  around  Cape  Horn  without  any- 
trouble  or  detriment  to  your  business  ?  A.  Yes,  sir;  there  are  a  great 
many  classes  of  goods  that  are  needed  to  get  here,  that  we  get  over- 
land, within  thirty  days.  If  we  were  out  of  a  contract,  we  should 
probably  get  by  railroad,  under  open  rates,  from  fifteen  to  thirty- 
thousand  dollars  per  year.  % 

Q.  But  the  bulk  of  your  business  could  go  around  Cape  Horn, 
without  detriment  to  yourself?  A.  We  could  bring  everything 
around  the  Horn,  but  we  would  have  to  contract  six  months  in 
advance. 

Q.  Will  you  please  state  the  nature  of  that  special  contract?  A. 
The  nature  of  the  contract  is,  that  we  shall  ship  every  pound  of  our 
goods  that  we  receive  or  sell  on  this  coast  overland  that  comes  from 
the  United  States.  From  Europe,  we  can  ship  by  steamer  to  Panama, 
or  around  Cape  Horn,  but  everything  that  we  purchase  by  eastern 
lines,  we  are  to  ship  by  rail. 

Q.  Is  there  anything  else  in  the  contract?  A.  There  are  a  dozen 
or  more  clauses  in  it. 

Q.  State  any  other?  A.  Another  clause  is,  that  we  shall  not  pur- 
chase any  goods  except  from  those  that  are  brought  by  rail  to  San 
Francisco.  That  is  (something  to  that  effect),  I  do  not  pretend  to 
give  you  the  exact  language,  but  it  amounts  to  this:  you  can't  go 
into  the  San  Francisco  market  and  purchase  any  goods  of  any  kind 
unless  they  come  by  rail,  in  any  large  amount. 

Q.  Suppose  you  did  purchase  differently  from. the  stipulations  of 
the  contract,  what  is  the  effect  of  it  ?  A.  It  violates  it.  They  annul 
the  contract. 

Q.  AVho  is  the  judge  as  to  whether  it  should  be  annulled  ?  A.  The 
railroad  company  naturally  would  be,  if  they  knew  it. 

Q.  Suppose  there  is  a  difference  of  opinion  between  the  railroad 
company  and  the  shipper  in  regard  to  whether  it  has  been  violated, 
then  who  judges  of  the  violation?  A.  The  railroad  company,  and 
that  is  one  oi*  the  troubles.  It  gives  the  interior  merchants  more 
latitude  and  San  Francisco  very  little  in  that  respect. 

Q.  Suppose  you  sign  a  contract  with  the  railroad  company  and 
they  say:  "Mr.  Hawley,  you  have  violated  your  contract."  You 
reply  that  in  your  opinion  you  are  justifiable — you  have  a  reason 
that  may  be  sufficient — who  judges  between  the  railroad  company 
and  the  shipper?  A.  They  shut  right  down  on  you,  and  claim  that 
you  have  violated  the  contract,  and  there  is  always  a  great  many 
overcharges  (it  can't  be  helped)  upon  the  goods.  They  refund  the 
money  to  us.  They  claimed  that  we  had  violated  the  contract,  and 
they  locked  up  some  twenty-five  or  thirty  thousand  dollars  for  sev- 
eral months,  till  we  cleared  the  matter  up. 

Q.  Thai  was  robbery,  was  it  not?  A.  Yes,  sir;  but  we  did  not 
object. 

Q.  Suppose  there  is  a  difference,  then,  between  a  shipper  and 
a*  railroad  company,  and  .the  shipper  tells  them  that  he  is  justified 
in  the  violation,  who  is  the  judge  whether  he  is  right  or  otherwise? 
The  company'there  is  the  absolute  judge  as  to  whether  the  contract 
has  been  violated,  is  it  not?    A.  No;  we  can  go  right  into  the  Courts 


144 

and  say,  "  Here,  they  are  keeping  back  some  of  mj7  money."  They 
are  not  the  ultimate  judge,  as 

Q.  The  contract  is  held  void  by  them?  A.  That  is  another 
matter.  I  can  keep  right  on  shipping  my  goods,  and  they  can  charge 
the  open  tariff,  and  not  refund  my  money  until  I  prove  that  I  am 
right.  If  they  should  hold  back  my  contract,  and  say  I  had  violated 
it,  and  I  can  prove  that,  I  might  have  shipped  around  the  Horn, 
and  fight  it  out  with  them.  I  think  there  are  two  sides  to  the 
question. 

Q.  You  think  it  is  for  the  best  interests  of  the  State  that  these 
special  contracts  shall  exist?     A.  Yes,  sir. 

Q.  Do  you  believe  that  a  contract  which  stipulates  that  the  person 
who  holds  it  shall  not  deal  in  merchandise  with  any  person  except 
it  has  been  brought  overland  by  rail  by  such  person,  is  according  to 
the  best  policy?  A.  It  can't  be  otherwise.  They  have  to  have  that 
in.  They  don't  hold  to  it  with  the  interior  merchants;  they  give 
them  greater  latitude.     If  they  will  give  me  the  privilege  of  sorting 

up  in  San  Francisco For  instance,  I  want  forty  or  fifty  thousand 

kegs  of  nails.  Now,  I  can  send  nails  around  Cape  Horn,  including 
freight  and  insurance,  at  forty  cents  a  keg.  We  pay  seventy,  or 
eighty,  or  ninety,  under  our  contract.  Now,  if  they  will  give  me  the 
privilege  of  buying  those  nails  in  San  Francisco,  I  can  save  $20,000 
a  year.  If  they  don't  draw  the  line  pretty  straight,  I  can  go  and 
buy  a  thousand  kegs  from  one  merchant  one  month,  and  more  from 
others  that  ship  round  the  Horn;  and  if  I  did,  I  might  divide  the 
contract  and  give  them  a  portion.  I  could  arrange  it  with  the  parties 
from  whom  I  buy  to  say,  "  You  send  them  out  to  Oilman, "  and  in 
that  way  I  could  avoid  my  contract  and  pay  him  a  small  commis- 
sion. But  they  draw  it  strong  and  say,  "You  shall  purchase  all." 
I  sa3r,  "What  do  you  mean  by  'all?'"  "I  mean  the  great  bulk  of 
your  freight."  I  am  at  liberty  to  buy  a  great  many  things  to  sort  up 
with,  but  they  want  to  stop  you  from  getting  goods  around  Cape 
Horn. 

Q.  Do  you  know  any  instance  where  the  company  has  annulled  the 
contract,  upon  the  ground  that  the  person  has  sold  goods  to  a  party 
who  was  not  a  contractor?  A.  No;  they  have  no  right  to.  If  I 
have  a  contract,  I  may  sell  to  whom  I  please. 

Q.  Suppose  you  bought  goods,  when  under  the  contract,  from  a  per- 
son who  has  no  contract.  Do  you  apprehend  that  your  contract 
would  be  annulled  for  that  reason?  A.  I  think  so.  There  have 
been  a  great  many  annulled.  I  know  of  many  instances  where  men 
have  violated  contracts,  because  men  holding  them  have  bought 
goods  that  were  shipped  around  the  Horn.  They  have  taken  con- 
tracts in  good  faith  and  then  bought  goods  shipped  around  the  Horn, 
and  it  has  been  found  out  time  and  time  again;  and  by  iloing  that 
they  injure  men  who  stand  up  to  their  contract. 

Q.  You  know  there  arc  cases  where  men,  not  under  a  contract,  use 
the  name  of  a  contractor  in  getting  goods?  A.  I  think  so.  1  know 
of  a  house  that  told  me  they  have  a  great  many  goods  out  under 
contract,  because  they  could  get  men  to  stretch  their  consciences  and 
allow  them  to  do  it. 


145 

Q.  Is  there  any  clause  in  the  contract  which  says  that  the  books 
of  the  shipper  may  be  examined  by  the  company  in  case  of  the  sup- 
posed violation?    A.  Not  that  I  am  aware  of. 

Q.  Do  you  think  that  it  is  discrimination  in  favor  of  persons? 
A.  It  certainly  is. 

Q.  Is  it  not  discrimination  against  the  shipping  interests  of  the 
country?  A.  Not  to  any  great  extent;  it  is  slightly  so.  It  is  also  an 
injury  to  the  farmer,  to  some  extent,  but  the  farmer  injures  himself 
when  he  ships  his  wheat  by  rail  to  New  Orleans  and  from  there  by 
ship.  That  is  detrimental  to  the  shipping  interests  around  Cape 
Horn. 

Senator  McClure — Your  contract  does  not  apply  to  sorting  up  or 
to  filling  a  temporary  order?  A.  No,  sir;  but  if  we  did  so  for  the 
purpose  of  filling  up  by  purchasing  goods  shipped  around  the  Horn, 
it  would  violate  the  contract.  I  could  save  on  some  goods  from  two 
and  a  half  to  five  per  cent  by  doing  so. 

Q.  You  said  that  if  it  was  to  your  interest  you  could  ship  again 
around  the  Horn  when  your  contract  expires?    A.  Yes,  sir. 

Q.  You  are  not  forced  to  take  it?  A.  We  were  running  a  contract 
for  four  years  and  then  broke  off  and  sent  around  the  Horn;  I  may 
do  so  again  on  the  first  of  July.  It  is  a  matter  of  figuring  whether  I 
do  or  not — whichever  is  the  cheapest. 

Q.  Do  you  understand  that  merchants  are  coerced  into  these  con- 
tracts? A.  Not  at  all;  it  is  at  their  option  to  take  them  or  not,  and 
whether  it  is  to  their  interest. 

Q.  It  would  make  a  great  difference  to  the  railroad  company? 
A.  Yes,  sir.  , 

Q.  Then  it  is  in  the  interest  of  both  the  railroad  company  and  the 
merchants?    A.  Yes,  sir. 

Q.  You  deal  a  great  deal  with  farmers?  A.  Yes,  sir.  I  believe 
that  under  the  special  contract  system  we  are  in  a  position  to  benefit 
the  farmers  at  times  more  than  if  we  were  shipping  around  the  Horn, 
because  we  are  keeping  on  hand  now  a  constant  supply  of  agricult- 
ural implements,  and  this  season  the  demand  is  going  to  be  very 
large — twice  what  it  was  last  year.  The  demand  is  great,  and  we 
could  not  ship  it  without  advancing  the  price  of  goods.  This  season 
we  would  have  to  ship  twice  as  much  as  before,  and  we  cannot  tell 
in  advance  in  time  to  ship  around  the  Horn. 

Q.  This  does  not  affect  goods  that  may  be  shipped  from  Europe  ? 
A.  No,  sir. 

Q.  The  principal  ships  that  come  take  wheat  to  Europe?  A.  The 
ships  that  come  here  are  about  nine  tenths  of  them  from  the  Euro- 
pean markets  and  about  one.  tenth  from  ours. 

Senator  Del  Valle — Isn't  the  reason  of  that  the  fact  that  there 
is  no  freight  for  them  on  account  of  this  special  system?  A.  No;  I 
made  a  careful  estimate  of  it  two  or  three  years  ago,  and  found  that 
the  New  York,  Boston,  and  Philadelphia  ships,  which  brought  us 
merchandise,  was  about  one  tenth  of  the  whole;  and  as  for  grain,  for 
two  or  three  merchants  to  go  in  and  make  a  contract,  would  not 
affect  the  rate  on  grain — not  half  as  much  injury  to  the  shipping 
around  the  Horn  as  the  shipping  of  grain  to  New  Orleans. 
10 b 


146 

Q.  In  your  line  of  goods,  how  many  classifications  are  there?  A. 
Six  or  eight — one,  two,  three,  four — A,  B,  C,  D.  I  think  that  every 
article  is  classified  under  one  of  those  heads. 

Q.  Does  that  classification  take  in  all  classes  of  goods  in  the  State, 
or  is  there  any  other  division  ?  A.  A,B,  C,  and  D.  takes  in  all  the 
heavy  class  of  goods  of  this  State. 

Q.  You  deal  entirely  in  hardware?  A.  And  agricultural  goods  for 
fanners. 

Q.  Don't  you  think  the  fact  that  you  deal  in  that  class  of  goods 
causes  the  railroad  company  to  be  more  liberal  with  you  because  you 
can  ship  them  around  by  water  just  as  well?  A.  I  have  no  differ- 
ent tariff  than  Huntington,  Hopkins  &  Co.,  and  other  large  houses. 
Every  tariff  is  the  same  on  the  same  line  of  goods. 

Q.  You  mean  people  who  deal  in  that  class  of  goods?  A.  I  think 
that  every  merchant  in  San  Francisco,  who  deals  in  agricultural 
goods,  gets  exactly  the  same  tariff  under  the  special  contract. 

Q.  Has  the  firm  of  Baker  &  Hamilton  a  contract?  A.  The  same 
as  ours. 

Q.  Wasn't  Baker  &  Hamilton  compelled  to  get  one  in  order  to  com- 
pete with  you?  A.  No,  sir.  It  is  a  question  to-day.  They  think 
they  are  making  less  money  than  they  would  by  shipping  around 
the  Horn. 

Q.  Then  they  are  conducting  business  at  a  loss?  A.  No,  sir;  I 
don't  think  that  they  are,  but  they  have  stated,  time  and  again,  that 
they  are  losing  by  it.  Now,  it  is  just  the  same  way  in  other  business 
in  San  Francisco.  One  of  the  largest  houses  has  a  contract,  but  it  is 
not  a  question  of  freight  alone;  it  is  sorting  goods  and  getting  them 
here  in  time,  and  the  carrying  of  a  large  amount  of  stock  and  agreat 
many  benefits  that  we  derive  under  the  special  contract. 

Q.  Isn't  it  a  fact,  that  you  get  out  of  a  certain  class  of  goods,  and 
that  it  would  take  too  long  a  time  to  get  them  here  by  water? 
A.  We  keep  a  man  doing  nothing  else  but  buying  goods  for  our  house 
in  the  San  Francisco  market,  and  so  do  Huntington,  Hopkins  & 
Company. 

Senator  Sullivan— And,  therefore,  it  is  a  matter  of  necessity  to 
ship  by  rail?  A.  It  is  a  matter  of  dollars  and  cents,  and  that  is  the 
only  tiling  that  we  take  into  consideration;  only  we  pay  more  by 
rail  than  by  water.  We  probably  could  get  goods  here  for  one 
hundred  thousand  dollars  that  will  cost  us  one  hundred  and  five 
thousand  dollars  to  get  them  here  by  rail. 

Q.  It  frequently  occurs  that  you  have  to  send  goods  across  the  conti- 
nent when  you  get  out  of  them?  A.  We  always  get  them,  contract 
or  no  contract,  ever  since  the  railroad  was  opened. 

Q.  Suppose  you  were  dealing  in  San  P>aneisco,  and  that  you  got 
out  of  a  certain  line  of  reapers  and  mowers,  you  couldn't  go  to  the 
railroad  and  get  them  sent  at  the  same  rate  as  if  you  had  a  special 
contract?     A.  No,  sir. 

Q.  Neither  could  you  go,  if  you  had  a  contract,  and  buy  from  a 
man  that  did  not  have  one,  but  shipped  around  the  Horn?  A.  We 
could  not. 

Q.  And  you  say  that  is  not  malicious?    A.  I  do. 


147 

Q.  Isn't  it  a  matter  of  fact  that  it  discriminates  against  the  ship- 
ping-interests of  the  State?  A.  Slightly  so;  hut  not  to  any  great 
extent.  Every  ship  stopped  from  coming  here  would  bring  some 
freight,  and  would  get  some  return  freight,  but  if  we  had  twice  as 
many  ships  in  San  Francisco  to-day,  freights  would  naturally  come 
down. 

Q.  Assuming  that  the  tendency  of  these  contracts  is  to  drive  the 
shipping  from  the  water,  then  it  is  prohibiting  the  shipping  interests 
and  depriving  us  of  its  advantages,  is  it  not?  A.  Certainly  it  does; 
but  on  the  same  principle,  if  the  railroad  company  goes  to  the  farmer 
and  tells  him,  "  Your  freight  by  water  costs  you  forty  shillings,  I  will 
take  it  to  Liverpool  for  thirty-eight  shillings,"  there  is  not  a  farmer 
in  the  State  but  what  will  ship  by  rail.  And  they  will  ship  by  rail 
to  New  Orleans,  and  by  steamer  from  there  to  Liverpool.  They 
would  not  stop  to  consider  how  it  was  going  to  affect  other  shipping 
interests.     They  would  consider  their  profits. 

Q.  You  think  that  the  interests  of  the  country  would  be  advanced, 
and  that  it  would  be  cheaper  and  better  for  them?    A.  Yes,  sir. 

Q.  If  you  could  sell  the  farmers  mowers  at  twenty  dollars  apiece 
instead  of  fifty  dollars  apiece,  do  you  think  that  would  benefit  them? 
A.  Certainly  it  would. 

Q.  And  anything  that  has  a  tendency  to  raise  freights,  damages 
the  interests  of  this  State?    A.  It  does,  sir. 

Q.  In  making  up  a  bill  of  goods,  if  only  a  few  goods  are  needed 
to  fill  an  order,  you  can  go  out  and  fill  it  by  buying  from  a  person 
who  ships  around  the  Horn?     A.  Yes,  sir. 

Q.  Does  your  contract  make  that  exception  or  is  it  a  mere  personal 
indulgence  ?    A.  It  is. 

Q.  Then  they  can  discriminate  in  favor  of  a  man  that  they  like, 
and  against  a  man  that  they  do  not  like?  A.  Yes,  sir;  but  they  have 
got  to  lay  down  some  general  rule. 

Q.  The  rule  is  the  measure  of  the  contract,  is  it  not?  A.  If  you 
agree  to  a  contract,  you  agree  not  to  buy  goods  that  are  shipped 
around  the  Horn,  and  it  is  at  their  election  to  stop  you  if  you  violate 
the  contract. 

Q.  If  you  go  out  and  buy  goods  at  all,  technically  you  violate  the 
contract?  A.  Yes;  but  it  is  understood  verbally  with  the  railroad 
company  that  we  can  buy  to  fill  up  any  small  order  that  we  desire. 
Now,  the  merchants  in  the  interior,  at  Marysville  and  Stockton,  etc., 
have  five  times  as  many  privileges  as  the  merchants  of  San  Fran- 
cisco have. 

Q.  Then,  they  have  one  interpretation  for  the  merchants  in  the 
interior,  and  another  for  the  merchants  of  San  Francisco?  A.  Yes, 
sir. 

Q.  What  do  you  think  of  that?     A.  I  call  it  a  "necessity." 

Q.  That  is  a  new  word  for  it?  A.  I  will  explain  it.  They  desired 
to  make;  arrangements  with  the  larger  San  Francisco  firms,  and,  as  I 
told  you,  they  made  arrangements  with  Hawley  Brothers  for  one 
year  to  test  this  matter,  and  after  that,  they  took  in  nearly  every  one 
of  the  large  wholesale  firms  of  San  Francisco.  They  desired  to  have 
a  special  contract  too.     After  that,  they  took  in  the  interior  mer- 


148 

chants.  They  said:  "I  hear  you  have  a  special  contract?"  "Yes." 
"We  want  the  same,"  and  the  railroad  company  said,  "We  will  give 
you  the  special  contract."  Now,  a  house  in  Marysville  can  get  the 
contract  the  same  as  we  can.  They  agree  that  all  the  goods  they 
import  shall  come  by  rail,  and  also  that  they  will  not  buy  any  goods 
to  any  extent  from  merchants  who  ship  goods  around  the  Horn. 
When  they  are  out  of  goods  at  Sacramento,  or  Marysville,  or  Stock- 
ton, perhaps  they  do  not  want  but  one  or  two  articles.  The  merchant 
comes  down  here  and  he  says,  "  Under  the  special  contract  I  cannot 
buy  from  you  men  that  ship  round  the  Horn,  but  I  want  the  goods, 
and  I  cannot  get  them  from  any  other  house  in  San  Francisco  ;  I 
can't  get  them  in  the  East ;  I  must  have  them  to  supply  my  cus- 
tomers at  once  ;  what  am  I  to  do  ;  I  want  a  certain  kind  of  headers." 
Now,  the  railroad  company  say,  "We  do  not  make  this  contract  to 
injure  your  business;  we  make  it  to  benefit  you.  We  will  give  you 
the  privilege  of  buying  them,  even  though  they  came  round  the 
Horn."  They  buy  of  Baker  &  Hamilton,  or  of  other  men  who  have 
shipped  around  the  Horn  ;  but  I  do  not  have  that  privilege. 

Q.  Do  you  know  whether  there  is  any  difference  between  the 
Marysville  rate  and  the  city  rate?     A.  I  am  told  that  there  is. 

Q.  In  favor  of  which  one?  A.  I  have  never  seen  a  contract  with 
an  interior  merchant,  and  I  only  get  it  by  hearsay;  but  I  am  told  so 
positively  that  it  is  in  favor  of  the  San  Francisco  merchants. 

Q.  Do  you  pay  a  certain  amount  of  freight  and  at  the  end  of  a 
month  or  such  a  matter  have  a  portion  of  it  returned  to  you?  A.  I 
do. 

Q.  How  much  do  you  pay  in  that  way?  A.  Our  freights  are  two 
hundred  thousand  dollars  a  year.  We  pay  them  as  they  come,  and 
I  think  there  is  on  an  average  from  ten  to  twenty  per  cent  of  the 
money  that  we  pay  locked  up  by  the  railroad  company  for  a  short 
time.  Well,  it  is  getting  down  to  about  a  week  now,  but  it  used  to  be 
sometimes  two  months;  sometimes,  for  instance,  we  would  get  a  ship- 
ment of  agricultural  goods  over  the  road  and  it  would  get  tied  up 
and  they  could  not  adjust  it  until  they  could  have  time  to  find  out 
where  the  trouble  was,  and  where  the  overcharge  had  been  made,  and 
who  was  to  forfeit  the  shipping.  There  is  a  bill  made  out  in  the  San 
Francisco  office  at  the  rate  of  the  contract,  and  that  includes  all  con- 
tracts made  by  them  with  other  companies  east  of  the  Missouri 
River. 

Q.  They  adjust  the  mistakes?  A.  They  adjust  the  overcharges 
made  against  us  by  the  parties  in  the  East.  They  do  not  know  ex- 
actly the  terms  upon  which  these  parties  are  shipping  the  goods, 
and  sometimes  they  have  to  pay  the  rates  of  those  who  do  not  enter 
into  the  pool. 

Q.  What  is  the  average  freight  on  a  carload  of  goods  overland? 
A.  The  cost  of  the  freight  on  a  carload  of  goods  is  from  five  hundred 
dollars  to  eight  hundred  dollars.  We  have  had  ten  thousand  dollars 
of  overcharges  at  one  time  awaiting  adjustment. 

Q.  You  pay  all  that  money  before  you  receive  the  goods?  A.  We 
pay  our  freight  bills  before  the  goods  leave  the  depot. 

Q.  Upon  what  basis  do  you  pay?     A.  We  pay  the  freight  bill  just 


149 

as  it  is  made  out,  no  matter  what  it  is.  In  fact  we  do  not  pay  the 
freight  bills.  The  arrangement  is  to  assist  the  merchants  of  San 
Francisco.  They  authorize  a  man  to  take  the  goods  and  pay  the 
freight  bills,  and"  he  gives  his  own  check,  and  when  he  brings  them  to 
us  we  pay  him.  That  is  the  way  business  is  done  in  San  Francisco. 
We  are  obliged  to  pay  it,  even  if  it  were  overcharged  three  times.  . 

Q.  In  case  of  a  difference  between  the  consignee  and  the  shipper, 
it  is  the  invariable  rule  that  any  overcharge  is  to  be  paid  first  and 
adjusted  afterwards?  A.  Yes,  sir;  we  always  pay  the  freight  bill 
just  as  it  is  presented  to  us,  no  matter  what  the  overcharge  may  be. 

Q.  Supposing  that  there  is  any  dispute  about  the  loss  of  any  goods, 
suppose  that  a  part  of  the  goods  do  not  come,  are  you  obliged  to 
pay  for  the  whole  ?     A.  No,  sir ;  we  pay  freight  only  on  those  received. 

Q.  There  is  no  rule  requiring  the  whole  of  the  money  to  be  paid 
for  the  whole  amount  of  goods  shipped  ?  A.  There  is  no  rule.  For 
instance,  it  may  be  that  I  ship  a  carload  of  wheels,  and  I  am  charged 
for  the  full  carload,  but  it  says  on  the  bill,  "  Twenty  wheels  to  follow;" 
I  pay  for  the  full  carload,  and  the  twenty  wheels  came  in  may  be  in  a 
week  or  two  afterwards. 

Q.  Suppose  that  there  are  five  wheels  gone,  do  you  pay  for  the 
whole  and  correct  the  matter  afterwards?  A.  Certainly  they  do; 
you  frequently  have  five  cases  and  only  four  would  come  in.  You 
pay  freight  on  the  five,  because  you  can't  very  well  determine  what 
freight  is  on  the  four;  but  it  is  very  seldom  that  a  case  is  lost — it  is 
not  one  time  in  five  hundred. 

Q.  Supposing  that  the  open  rates  are  ten  dollars  and  the  special 
contract  is  five,  do  I  understand  you  that  the  merchant  pays  the  ten 
dollars,  and  that  the  adjustment  is  made  to  give  him  the  five  dollars 
difference?     A.  No,  sir. 

Q.  Has  there  been  any  rebate  of  that  character?  A.  Not  that  I 
know  of.     They  do  not  make  the  freights  to  us  in  that  way. 

Q.  I  suppose  you  have  studied  this  freight  question  to  some  extent? 
A.  I  have  endeavored  to  do  so. 

Q.  Did  you  ever  calculate  how  much  money  the  Central  Pacific 
Railroad  Company  had  tied  up  on  your  advances?  A.  No,  sir.  It 
would  be  very  easily  calculated.  If  there  was  $10,000  to  us,  multiply 
it  by  the  number  of  merchants. 

Q.  Do  you  not  think  that  that  is  harsh  on  the  merchants?  A. 
Yes;  it  seems  to  be.  But  they  say  it  is  necessary;  that  they  have 
good  reasons  for  it. 

Q.  Do  you  know  whether  any  of  that  money  is  kept  back  for  fear 
that  the  merchants  will  violate  their  contract?  A.  I  never  supposed 
it  to  be.  If  they  understand  that  he  had,  they  would  say  to  him,  "I 
understand  that  you  have  violated  your  contract,  and  we  will  not 
pay  you  any  rebate  till  this  is  adjusted."  They  may  have  done  that 
with  other  merchants;  I  can't  say.     In  our  case,  I  know. 

Q.  Do  you  know  of  many  firms  in  this  State  that  have  had  the 
temerity  to  fight  with  the  Central  Pacific  Railroad  Company,  con- 
cerning the  compliance  with  this  special  contract?  A.  I  don't  know 
of  a  single  firm  but  what  have  had  some  little  grievances  toward  the 
railroad  company.  I  think  that  Baker  &  Hamilton  had  a  matter  at 
one  time,  and  that  it  was  never  satisfactorily  fixed  up. 


150 

Q,.  You  have  heard  of  the  suit  which  the  firm  of  Richards  &  Har- 
rison have  with- the  Central  Pacific  Railroad  Company?  A.  No,  sir. 
Well.  I  saw  something  in  the  paper  about  it,  but  I  couldn't  tell  the 
origin  of  it.  I  know  that  they  have  several  claims  against  the  rail- 
road com  pain',  upon  several  different  occasions;  whether  they  have 
started  suits  or  not,  I  don't  know. 

Q.  Do  you  not,  as  a  merchant,  dealing  in  agricultural  goods, 
depend  largely  upon  the  country  trade?    A.  I  do,  almost  altogether. 

Q.  What  is  the  effect,  as  far  as  country  trade  is  concerned,  upon  the 
man  who  has  no  contract  with  the  Central  Pacific  Railroad  Com- 
pany? A.  If  he  is  a  man  that  is  doing  a  small  retail  business  it  has 
very  little  effect,  because  he  is  supposed  to  buy  all  those  goods  in  San 
Francisco;  but  the  railroad  men  go  to  men  at  different  points,  and 
say  to  them,  "  You  may  have  a  special  contract,"  and  that  is  the  fact 
at  a  good  many  places  in  the  interior.  Then  they  come  to  us.  They 
buy  a  carload,  and  they  can't  dispose  of  them,  then  they  come  to  us 
and  ask  us  to  carry  them. 

Q.  Do  not  the  merchants  discriminate  in  favor  of  the  man  who 
has  a  special  contract  as  against  the  man  who  has  not,  in  San  Fran- 
cisco, in  regard  to  the  country  trade?     A.  No,  sir. 

Q.  There  is  no  discrimination  at  all?    A.  No,  sir. 

Q.  Isn't  it  a  fact,  that  the  Central  Pacific  Railroad  Company  have 
discriminated  against  the  merchants  who  received  their  freight  by 
water,  in  reference  to  the  country  trade  ?  A.  Not  that  I  am  aware 
of;  I  never  heard  of  it. 

Q.  You  have  never  known  of  any  such  discrimination  being  prac- 
ticed ?  A.  No,  sir.  We  shipped  around  the  Horn  for  two  years,  and 
we  never  knew  that  they  discriminated  against  us. 

Q.  When  a  farmer  has  ordered  goods,  haven't  they  forwarded  other 
goods  in  preference  to  those  that  were  shipped  around  the  Horn?  A. 
I  never  have  known  them  to  fail  to  forward  our  goods  as  soon  as  any 
other  freight. 

Q.  Assuming  that  the  Central  Pacific  Railroad  Company  will  not 
carry  the  goods  at  all  of  a  firm  that  ships  b.y  water,  do  you  not  think 
that  that  would  have  an  injurious  effect  upon  the  people  of  the  State? 
A.  It  would. 

Q.  If  that  is  the  effect  of  the  special  contract,  do  you  not  think  that 
it  would  be  contrary  to  the  best  public  policy?  A.  If  it  had  that 
effect,  certainly. 

Q.  I  understood  you  to  say  that  when  Mr.  Stubbs  came  to  .you,  that 
you  showed  him  that  you  had  lost  $60,000  by  carrying  your  goods 
under  special  contract  for  that  year.  Is  that  correct?  A.  Not 
exactly.  I  told  you  that  after  we  had  been  shipping  a  year  that  we 
stopped  and  went  around  the  Horn,  and  that  he  came  to  us  and 
asked  us  to  make  a  new  contract.  He  says  to  us,  "  We  want  to  carry 
all  your  goods."  I  said  to  him,  "Provided  you  give  us  satisfactory 
rates."  He  said,  "  What  terms  do  you  want?"  Then  we  figured  up 
and  showed  him  that  we  had  followed  out  the  provisions  of  the  con- 
tract and  paid  the  prices  then  exacted;  that  we  had  lost  on  last  year's 
goods  $67, 000;  and  upon  that  showing  he  ottered  a  reduction  of  tlie 
special  contract,  which  at  that  time  was  in  force. 


151 

Q.  What  reason  did  he  assign ;  you  stated  that  he  consulted  with 
the  Union  Pacific  Railroad  Company?  A.  At  first  he  said  that  ray 
figures  lied,  but  that  he  would  see  the  railroad  company  and  take 
three  weeks  to  examine  them  ;  but  he  gradually  yielded,  and  we  also 
gave  up  a  little,  and  made  the  contract. 

Q.  Do  I  understand  you  that  the  Central  Pacific  Railroad  Com- 
pany, as  a  special  favor  to  Mr.  Stubbs,  reduced  these  rates?  A.  No, 
sir,  not  as  a  special  favor  to  our  firm  at  all;  he  was  negotiating  with 
another  firm,  and  whilst  he  was  negotiating  with  them  we  took  it 
up,  and  Baker  &  Hamilton  and  other  firms,  and  we  got  the  rates 
satisfactory;  but  he  showed  us  no  favor  more  than  to  any  other 
house  in  San  Francisco,  for  he  said,  "If  I  make  this  contract  with 
you,  I  shall  have  to  make  it  with  all;"  and  it  takes  in  all  the  whole- 
sale merchants. 

Q.  Do  the  smaller  merchants,  and  those  who  do  more  of  a  retail 
business,  have  the  same  rates  that  you  get?  A.  I  do  not  understand, 
that  they  have;  I  have  never  seen  their  contract;  I  don't  believe 
that  they  do. 

Q.  They  discriminate  in  your  favor  as  against  the  retail  dealers? 
A.  So  I  understand  it. 

Senator  McClure — Do  I  understand  you  to  say  that  during  the 
two  years  that  you  shipped  round  the  Horn  that  they  did  not  dis- 
criminate against  you  as  to  open  rates?  A.  No,  sir;  they  did  not 
discriminate  against  us  as  to  open  rates. 

Q.  You  had  the  same  as  others?     A.  Yes,  sir. 

Q.  You  are  well  acquainted  vvith  the  merchants  of  San  Francisco? 
A.  Yes,  sir. 

Q.  Do  you  know  of  anything  arising  out  of  the  relationship 
between  the  merchants  of  San  Francisco  and  the  Central  Pacific 
Railroad  Company,  with  reference  to  this  special  Contract  system, 
that  would  cause  any  merchant  of  San  Francisco  to  hesitate  to  make 
a  truthful  statement  with  reference  to  the  special  contract  system? 
A.  I  know  of  no  reason  why  a  merchant  should  not  come  here  and 
tell  the  truth,  with  regard  to  the  special  contract  system,  except  one. 

Q.  State  that?  A.  There  seems  to  be  an  impression  through  the 
State  that  the  merchants  of  San  Francisco  are  getting  special  rates, 
under  this  special  contract  system,  over  and  above  the  interior,  and 
that  their  trade  with  the  interior  merchants  and  the  farming  com- 
munity will  be  affected. 

Q.  You  are  honest  in  your  statement,  and  feel  no  intimidation  in 
making  it?    A.  Not  at  all. 

Q,.  As  far  as  you  are  individually  concerned,  you  know  of  no 
reason  why  everything  should  not  be  stated  with  reference  to  the 
system?  A.  No  ;  if  I  understand  your  bill  here,  it  gives  discrimina- 
tion to  the  San  Francisco  merchants,  in  their  favor.  Why  should 
they  not  come  here  and  tell  you  ;  if  it  is  in  their  favor,  they  should 
favor  that  bill  with  slight  modifications. 

Q.  Then  you  think  if  the  bill  should  be  passed  that  it  would  be 
in  favor  of  the  San  Francisco  merchants,  and  against  the  interior? 
A.  The  first  two  or  three  sections  of  this  bill,  with  slight  modifica- 
tions, I  would  favor  it. 


152 

Q.  How  is  it  with  reference  to  discrimination  between  persons? 
A.  The  bill  states,  as  I  understand  it,  that  there  shall  be  discrimina- 
tion. 

Senator  Sullivan — I  understood  you  to  state  that  there  was  a 
special  contract  between  you  and  the  Central  Pacific  Railroad  Com- 
pany, and  that  afterwards,  at  the  end  of  the  year,  you  commenced 
shipping  by  water?    A.  Yes,  sir. 

Q.  And  that  afterwards  there  was  another  arrangement  made.  Did 
you  make  mutual  concessions  in  making  that  arrangement?  A.  Yes, 
sir. 

Q.  Until  you  arrived  at  the  basis?     A.  Yes,  sir. 

Q.  In  that  arrangement  other  large  shippers  in  that  line  of  business 
were  consulted,  were  they  not?  A.  Nearly  every  one  of  them.  Yes, 
sir ;  they  were  all  consulted,  small  and  large,  and  asked  a  reduction, 
and  it  was  fixed  up. 

Q.  Has  the  tendency  been  to  lower  or  raise  the  former  price  of 
goods  since  you  entered  into  the  system?  A.  There  is  a  difference 
among  merchants  as  to  that.  I  may  claim  that  under  the  special 
contract  I  can  sell  my  goods  cheaper  than  I  could  without.  Another 
merchant  may  figure  that  the  goods  cost  a  trifle  more  and  that  there- 
fore they  ought  to  charge  higher.  I  have  felt  that  under  the  special 
contract  I  had  an  advantage  in  some  respects  over  merchants  that 
shipped  around  the  Horn,  and  that  I  could  compete  with  them  suc- 
cessfully and  sell  the  goods  lower,  and  that  I  have  made  money  by  it 
in  some  years. 

Q.  You  are  familiar  with  the  shipping  interests  of  San  Francisco  ? 
A.  Somewhat  so. 

Q.  Supposing  that  all  of  the  merchants  of  this  coast  shipped  their 
goods  by  rail,  what  would  be  the  percentage  of  shipping  that  would 
be  lost  to  this  State?  A.  I  couldn't  tell  you  the  percentage,  but  it  is 
very  easy  to  ascertain.  If  you  take  the  Journal  of  Commerce  you 
will  find,  say  sixty  ships,  with  general  merchandise.  If  the  goods 
were  shipped  around  the  Horn  those  would  not  come  to  San  Fran- 
cisco. I  looked  over  the  matter  two  years  ago  and  I  found  that  about 
one  tenth  of  all  the  ships  coming  here  were  loaded  with  freight  for 
San  Francisco  (general  merchandise)  not  including  ships  that  came 
from  Europe.  There  are  a  great  many  ships  that  bring  merchandise 
from  Europe,  but  any  one  under  a  special  contract  can  ship  goods 
upon  them. 

Q.  Is  the  carrying  done  principally  by  foreign  ships?  A.  Four 
fifths  of  it. 

Q.  In  loading  a  foreign  ship  for  San  Francisco,  say  from  Liverpool, 
is  it  not  customary  for  them  to  touch  at  some  point  on  the  Atlantic 
for  a  portion  of  their  load?     A.  I  never  have  known  them  to  do  so. 

Senator  Whitney — I  understand  you  to  state  that  you  thought 
this  bill,  with  some  slight  modifications,  would  be  a  good  bill  for  San 
Francisco,  for  the  reason  that  it  recognizes  and  provides  for  discrim- 
ination ?     A.  Yes,  sir. 

Q.  Will  you  explain  to  the  committee  what  you  meant  by  that? 
A.  It  says  that  there  shall  be  no  discrimination,  but  on  line  ten  of  the 
first  page,  it  says,  "except  as  hereinafter  provided."    Now,  if  you  will 


153 

give  us  plenty  of  exceptions,  we  shall  certainly  be  satisfied.  Now, 
what  are  the  exceptions?  On  page  second  of  this  bill,  at  line  four- 
teen, "different  rates  may  be  made  for  express  matter,  for  fast  and 
slow  freights."  I  wish  to  find  out  what  slow  freights  are ;  I  never 
heard  of  any  such  thing  as  slow  freights,  or  fast  freights,  but  itsays  so 
here.  Supposing  that  a  number  of  the  merchants  of  San  Francisco 
did  not  care  particularly  whether  they  got  their  goods  here  in  a 
hurry,  and  that  I  can  get  them  here  in  twenty-five  days  on  an  aver- 
age, I  will  make  a  contract  that  they  shall  be  delivered  here  in  sixty 
days.  Now, this  bill  calls  for  "fast"  and  "slow"  freights;  it  calls  for 
"carload  lots,  and  lots  under  a  carload."  Then,  the  merchant  of 
San  Francisco  can  ship  a  large  amount,  and  gets  a  chance  to  discrim- 
inate as  between  fast  and  slow  freight.  You  propose  to  discriminate 
between  large  and  small  merchants,  and  one  will  take  part  of  a  car- 
load, and  another  will  take  the  remainder.  Now,  if  you  go  still 
further  and  add  this  clause,  "between  merchants  who  ship  one,  two, 
three,  four,  and  five  hundred  thousand  dollars,  "  probably  there 
should  be  another  rate.  That  is  what  I  asked  Mr.  Stubbs  to  do  a 
year  and  a  half  ago  when  the  matter  was  brought  up ;  I  told  him  to 
discriminate  in  proportion  to  the  amount  of  freight  that  went  over 
the  road.  He  took  those  facts  and  laid  them  before  the  eastern 
roads.  I  can  see  that  it  would  affect  the  discrimination,  and  I  should 
say  that  that  bill  is  about  what  we  want  in  that  respect,  if  the 
amendment  that  I  have  suggested  is  put  in.  I  have  not  consulted, 
with  others,  but  from  what  I  know  of  those  matters,  I  should  pre- 
sume so.  It  would  be  satisfactory  to  me,  and  I  think  it  would  be  to 
the  merchants  of  San  Francisco. 

Q.  If  the  bill  prohibits  discrimination,  they  would  not  like  it? 
A.  No,  sir;  they  would  not  like  it. 

Senator  Vkooman — Your  freight  is  how  much?  A.  About 
$200,000  a  year. 

Q.  At  the  beginning  of  the  commercial  year  can  you  ascertain 
exactly  what  your  freights  would  be  for  that  year?  A.  Yes,  sir;  the 
year  that  our  line  of  business  really  began  commenced  in  September. 

Q.  Before  you  made  a  contract  with  the  railroad  company  I  under- 
stood you  to  state  that  you  made  a  yearly  contract  around  Cape 
Horn?     A.  Not  for  all  of  our  goods,  but  for  the  great  bulk  of  them. 

Q.  Would  you  be  compelled  to  have  your  freight  rate  fixed  for  the 
commercial  year,  in  shipping  around  the  Horn  ?  A.  I  would  have 
to  know  what  the  rates  were  before  I  could  make  a  contract. 

Q.  Wouldn't  it  be  to  your  benefit  to  make  a  contract  to  ship  round 
the  Horn  for  a  year?    A.  Yes,  sir. 

Q.  Then,  under  a  law  which  prevented  you  from  making  a  con- 
tract with  a  railroad  company  for  a  year,  and  which  did  not  prevent 
you  making  a  contract  with  a  shipowner,  you  would  naturally  be 
driven,  under  the  financial  pressure,  to  make  a  contract  with  the 
shipowner?     A.  Yes,  sir;  I  should  certainly  do  it. 

Q.  In  that  way  it  would  deprive  the  railroad  company  of  all  freight? 
A.  Yes,  sir;  nine  tenths  of  it  would  go  by  ship. 

Q.  Who  made  the  rate  between  you  and  the  railroad  company? 
A.  It  is  mutually  fixed  up  by  both  of  us.  They  came  partially  to 
our  terms,  and  we  sided  up  to  theirs. 


154 

Q.  You  got  such  a  rate  that  it  would  pay  you  to  ship  overland? 
A.  We  did. 

Q.  Did  they  come  to  your  rate?  A.  They  came  to  it  where  we 
could  not  give  in,  and  we  gave  them  a  rate  on  seventy-five  or  eighty, 
and  where  they  could  give  us  a  good  reason  they  gave  us  one  on  per- 
haps twenty. 

Q.  Where  they  did  not  give  you  a  good  reason  for  departing  from 
the  tariff  that  you  had  settled  yourself,  they  came  to  your  terms?  A. 
Yes,  sir;  they  ca'me  to  our  terms. 

Q.  Some  questions  have  been  asked  you,  trying  to  draw  a  distinc- 
tion between  the  merchants  in  your  line  of  business  and  the  mer- 
chants in  the  drygoods  business,  as  going  to  show  that  the  drygoods 
merchants  were  under  obligation  to  the  railroad  company,  because 
they  had  to  ship  goods  every  month;  and  Murphy,  Grant  &  Co  were 
cited.  I  presume  the}'  could  ship  goods  around  the  Horn,  if  they 
desired  to  wait  six  months  for  their  goods?  A.  Yes,  sir;  but  they 
would  have  to  wait,  and  they  would  probably  save  something  from 
what  they  pay  under  the  tariff.  Now  we  save  on  heavy  goods,  but 
on  some  goods  we  are  willing  to  pay  a  heavier  tariff,  and  pay  twice 
as  much  on  seasonable  goods  as  on  unseasonable  goods.  They  know 
that  they  would  have  to  get  seasonable  goods  by  rail,  but  the  railroad 
company  never  advance  above  the  open  rate. 

Q.  I  understood  you  to  say  that  the  railroad  company  discrimi- 
nated in  favor  of  certain  classes  of  persons  in  San  Francisco?  A. 
That  is  my  impression.  I  have  never  seen  any  of  the  contracts  ;  but 
people  tell  me  that  there  is  a  discrimination. 

Q.  People  in  your  line  of  business?  A.  Yes,  sir  ;  in  fact,  the  inte- 
rior merchants  know  that  the  San  Francisco  merchants  get  an  inside 
rate. 

Q.  How  many  merchants  are  there  in  San  Francisco  in  your  busi- 
ness? A.  We  claim  about  six  wholesale  merchants.  There  are  four 
or  five  in  the  hardware,  and  six  in  hardware  and  agricultural. 

Q.  Do  you  understand  that  you  are  all  to  have  the  same  rate  ?  A. 
Our  contract  says,  that  if  any  man  gets  a  lower  rate,  we  all — six  or 
eight  or  ten  of  us — have  the  same. 

Q.  Every  man  in  the  same  line  of  business  would  get  the  same 
rate  ?    A.  All  wholesale  merchants,  but  not  the  retail  merchants. 

Q.  Isn't  it  a  fact  that  you  large  importers  objected  because  the  rate 
was  open  to  the  small  importers  the  same  as  it  was  to  you?  A.  They 
should  object  to  that  if  they  were. 

Q.  Is  it  a  fact  that  the  large  importers  of  San  Francisco  protested 
against  the  special  contracts  because  they  gave  the  small  importer 
the  same  chance  that  they  did  the  larger  ones?  A.  They  gave  them 
a  better  chance. 

Q.  Why?  A.  I  will  tell  you  why:  Here  is  a  merchant  who  is 
complaining  that  he  has  not  got  as  good  a  contract  as  the  San  Fran- 
cisco merchant — I  was  speaking  to  him  this  morning.  He  says: 
"You  import  forty  carloads  of  plows  a  year,  or  about  that.  Why 
should  I  not  get  them  as  cheaply  as  you  do."  "Do  you  think  that  your 
customer  at  Marysville,  and  your  customer  at  Chico,  and  your  cus- 
tomer at  Red  Bluff,  should  join  together  and  bring  in  one  carload  of 


155 

plows  and  get  them  at  the  same  rate  that  I  do  forty  carloads  ?"  "  No, 
sir;  I  do  not."  "  And  yet  you  complain  because  a  man  can  under- 
sell you  who  outranks  you  in  San  Francisco,  and  who  is  at  the  tide 
water."  * 

Q.  You  think  that  the  man  who  is  the  largest  shipper  should  have 
the  best  rate?     A.  Yes,  sir;  and  your  bill  demands  it. 

Q.  Why  do  you  think  the  largest  importer  should  have  the  best 
rates?  A.  Because  he  has  always  had  that  advantage  by  water,  and 
unless  ho  lias  it  by  rail  he  will  go  back  to  the  water  and  have  it 
there,  and  then  the  small  retailers  in  the  interior  go  together,  and 
they  can  make  up  their  orders  and  outsell  the  wholesale  merchants 
in  San  Francisco,  and  that  is  driving  the  trade  away  from  San  Fran- 
cisco. There  are  three  or  four  houses  there,  and  their  trade  has  been 
thrown  off  by  the  eastern  merchants  at  Chicago  and  St.  Louis  and 
Kansas  City,  who  send  their  agents  on  to  this  coast,  and  their  drum- 
mers, and  they  go  to  one  hundred  different  points,  and  say,  "  We 
want  you  to  buy  your  goods  in  St.  Louis.  We  have  special  contracts 
with  the  railroad  company,  and  we  will  give  you  the  benefit  of  that. 
We  will  give  you  rates  that  undersell  San  Francisco.  We  don't  have 
to  pay  a  license,  and  we  don't  have  to  pay  storage,"  and  so  they  are 
getting  our  trade  continuously.  We  have  started  men  round  through 
the  country  to  say,  "  We  want  your  trade.  Give  us  your  business  on 
some  terms,  because  we  are  here.  If  you  do  we  will  send  men  there 
to  pack  the  goods,  and  send  to  the  factory,  and  gather  up  the  goods, 
and  send  them  directly  to  Stockton,  or  anywhere  else."  I  don't  know 
but  what  we  will  go  out  of  business  entirely,  and  start  a  business  in 
New  York  and  solicit  orders. 

Q.  One  of  the  objections  which  you  have  to  these  special  contracts 
is  that  it  enables  the  merchant  to  get  his  goods  delivered  as  cheaply 
in  Sacramento,  and  other  interior  points,  as  he  can  get  them  in  San 
Francisco?     A.  Yes,  sir. 

Q.  You  think,  then,  that  these  interior  towns  ought  not  to  enjoy 
the  same  facilities  for  getting  freight  as  the  San  Francisco  merchants 
enjoy?  A.  No,  sir;  we  cannot  pay  freight  to  Oroville  and  compete 
with  a  house  that  receives  goods  in  Marysville. 

Q.  If  we  can  sell  the  goods  in  Marysville  cheaper  than  you  can 
sell  them  in  San  Francisco,  is  that  not  a  benefit  to  Marysville?  A. 
It  may  be  a  benefit  to  the  customers  if  he  can  do  it,  but  it  is  break- 
ing up  the  business  of  San  Francisco,  and  discriminating  largely 
against  San  Francisco  and  in  favor  of  Marysville,  and  it  will  natu- 
rally force  us  to  start  branch  houses  in  the  interior  towns. 

Senator  Cross — Would  you  be  able  to  furnish  agricultural  imple- 
ments under  the  contract  cheaper  than  without  it?  A.  We  will  sell 
this  year  a  thousand  Buckeye  mowers,  and  we  could  contract  to  have 
them  laid  down  in  San  Francisco  at  four  dollars  and  fifty  cents  or 
five  dollars  apiece  freight,  and  we  have  a  contract  by  which  we  pay 
really  six  or  seven  on  the  matter  of  Buckeye  mowers;  the  farmer 
has  got  to  pay  more  unless  we  take  a  smaller  profit.  They  are 
made  at  New  York,  and  cost  us  nothing  except  shipment  around  the 
Horn.  But  if  he  wants  wagons  which  are  made  in  St.  Louis,  he  has 
got  to  pay  more  for  them  if  we  ship  them  around  the  Horn.     One 


156 

article  will  cost  more  and  another  less.  Now,  the  question  is,  does 
the  freight  on  the  whole  line  of  goods  cost  any  less  overland  than  by- 
water  ?  If  it  is  a  little  less  either  way  they  get  the  benefit  of  it.  On 
some  few  articles  they  pay  more,  and  on  others  less,  but  on  the  aver- 
age I  think  it  is  better  for  him  to  ship  overland. 

Q.  What  do  you  mean  by  "rebate"  upon  freight,  in  a  commercial 
sense  ?  A.  The  contract  may  be  for  three  cents,  and  when  they  send 
him  in  a  bill  they  may  give  him  a  rebate  of  the  difference  between 
three  and  two. 

Senator  Spencer — Do  you  call  overcharges  a  rebate?  A.  There 
is  seldom  a  freight  bill  made  out  according  to  our  contract;  it  is 
made  out  higher;  and  this  rebate  that  we  get  is  in  one  sense  an 
overcharge  and  in  another  sense  it  is  rebate;  I  can't  distinguish  it. 
Freight  goes  over  four  or  five  different  roads,  and  some  of  them 
charge  more  than  that  road;  it  may  have  been  correct,  but  it  has  to 
be  divided  up;  the  agent  may  not  understand  it;  and  on  some  goods 
the  freight  from  Omaha  is  a  regular  tariff;  there  is  no  trouble  about 
that ;  but  at  a  great  many  points  east  of  that  on  the  roads  freight  is 
overcharged. 

Q.  Do  you  get  this  rebate  for  the  purpose  of  giving  you  a  lower 
rate  than  your  contract,  or  for  the  purpose  of  bringing  it  down  to 
what  the  contract  is?  A.  For  the  purpose  of  bringing  it  down  to 
what  the  contract  is. 

Q.  If  you  shipped  by  open  contract  and  paid  more  than  the  freight 
bill,  when  you  got  your  money  back,  what  would  you  call  that?  A. 
Overcharge;  we  have  gof^no  rebates  at  all ;  they  are  all  overcharges 
that  we  have  paid  in. 

Senator  Sullivan — When  your  money  is  tied  up  by  the  railroad 
company  for  the  purpose  of  adjusting  differences,  is  it  from  the  nature 
of  the  business  or  for  the  purpose  of  using  it  to  control  you  in  any 
way?  A.,  It  comes  from  the  nature  of  the  business.  The  railroad 
company  have  been  seeking  to  avoid  it  all  the  time,  and  they  are 
getting  nearer  and  nearer  to  it,  and  the  overcharge  now  will  be  only 
sometimes  for  a  day  or  two  and  growing  less  all  the  time.  It  is  a 
good  deal  of  trouble  to  them  on  their  part. 

Q.  It  is  not  for  the  purpose  of  oppression?  A.  Not  at  all.  I  never 
looked  at  it  in  that  light. 

Q.  Do  the  merchants  of  San  Francisco  so  consider  it?  A.  No,  sir; 
the  railroad  company  are  a  little  slow  sometimes  in  making  up 
claims,  and  take  a  longer  time  than  it  ought  to,  but  when  we  get  an 
explanation  of  it  it  seems  to  be  reasonably  necessary.  We  have  some 
trouble  sometimes  in  trying  to  settle  them  ourselves.  They  have 
got  to  go  over  so  many  roads  and  find  out  the  rates  that  it  takes 
time. 

Q.  What  difference  would  this  bill  practically  make  over  the  pre- 
sent system?  A.  With  a  slight  modification  I  think  it  would  be 
acceptable  to  the  merchants  of  San  Francisco.  I  would  sign  it  on 
our  part.  It  does  give  us  much  discrimination.  It  is  a  bill  permit- 
ting discrimination,  the  way  I  look  at  it. 

Q.  You  think  that  at  the  present  time  there  is  no  discrimination 
but  under  this  bill  there  would  be?    A.  There  is  discrimination  at 


157 

this  time,  but  I  understand  that  a  great  many  of  the  people  of  the 
State  are  crying  out  against  it  and  this  would  seem  to  sanction  it. 

Q.  This  simply  makes  it  worse?  A.  This  seems  to  give  the  rail- 
road company  authority  to  make  these  discriminations.  I  only  put 
in  that  amendment,  that  I  suggested  there,  supposing  it  would  be  all 
right  in  that  portion  of  it. 

Q.  You  are  in  favor  of  it,  then?     A.  As  I  understand  it,  I  am. 

Q.  The  railroad  company  ought  to  be  in  favor  of  it,  then  ?  A.  I 
don't  know  whether  they  are  or  not. 

Senator  AVhitney — I  understand  that  you  think  there  should  be 
no  discrimination  in  dispatch,  speed,  or  accommodation  of  any  kind. 
Do  you  know  that  any  complaint  has  ever  arisen  at  which  that  could 
be  justly  aimed  ?  A.  I  do  not,  sir.  I  have  never  known  of  any  dis- 
crimination. 

Q.  Either  in  dispatch,  speed,  or  accommodation?  A.  No,  sir;  not 
on  the  overland.     I  have  known  of  discrimination  in  other  States. 

Senator  Vrooman — Do  you  know  whether  or  not  the  Central 
Pacific  Railroad  Company  advances  freight  charges  at  Ogden  when  it 
receives  goods  from  the  eastern  lines?  A.  Not  to  my  knowledge. 
Freight  from  the  east  comes  billed  to  them  at  the  eastern  tariff,  and 
they  add  their  own. 

Senator  Taylor — Do  you  know  whether  or  not  there  is  any  rebate 
upon  open  rates?    A.  I  never  have  heard  of  any. 

Q.  You  are  a  member  of  the  Chamber  of  Commerce  in  San  Fran- 
cisco ?     A.  Yes,  sir. 

Q.  What  proportion  of  the  merchants  have  these  special  contracts? 
A.  The  railroad  company  says  about  fourteen  hundred.  I  don't 
know  but  what  they  have  given  them  to  every  man  in  the  State. 

Q.  That  many  in  San  Francisco?  A.  No;  in  the  State.  A  large 
majority  of  the  wholesale  merchants  have  these  contracts.  I  don't 
know  how  many. 

Senator  Murphy — Would  not  the  practical  effect  of  this  bill  be 
to  drive  your  business  off  if  it  should  pass?  A.  As  I  interpret  the 
bill,  it  gives  us  about  the  same  discrimination;  but  if  it  allows  no 
discrimination  at  all  the  wholesale  merchants  can  go  round  Cape 
Horn  shipping  goods. 

Q.  Suppose  that  every  merchant  in  the  State  would  pay  the  same 
rate  for  shipping  as  under  the  special  contract  system,  what  effect 
would  it  have  on  the  San  Francisco  merchants?  A.  I  think  they 
would  go  round  Cape  Horn.  They  would  have  to  do  so  for  self 
protection.  The  effect  would  be  that  the  railroad  would  have  to 
advance  freights  to  the  interior  merchants.  They  could  not  live  at 
it  as  at  present. 

Q.  Why  would  they  have  to  ship  round  Cape  Horn  if  all  parties 
were  brought  down  to  the  same  level?  A.  When  you  bring  all 
parties  down  to  the  same  level,  you  give  the  interior  merchants  an 
advantage  over  the  larger  merchants  of  San  Francisco.  They  would 
have  the  advantage  over  us,  and  for  self  protection  we  would  have 
to  go  round  Cape  Horn. 

Q.  In  order  to  protect  the  merchants  of  San  Francisco  you  have 
to  give  them  a  lower  rate,  and  the  merchants  of  the  interior  a  higher 


158 

rate?  A.  Yes,  sir;  as  explained  awhile  ago.  The  interior  mer- 
chants have  more  latitude  than  the  San  Francisco  merchants. 

Q.  Wouldn't  that  have  a  tendency  to  build  up  the  interior?  A. 
No,  sir;  it  would  bankrupt  the  interior.  You  would  have  a  man 
with  three  thousand  dollars  trying  to  build  up  a  wholesale  business; 
importing  goods  directly  from  the  East,  and  trying  to  compete  with 
others,  and  in  six  months  it  would  bring  disaster  to  the  State. 

Q.  Suppose  that  he  had  a  large  capital  that  would  be  sufficient  to 
transact  the  business.  Of  course  it  would  not  have  that  effect  then? 
A.  No,  sir;  you  can  ship  the  whole  mercantile  business  of  San 
Francisco  to  Sacramento.  It  might  possibly  be  done.  It  would 
build  up  those  interior  towns,  provided  they  had  capital  to  do 
business.  If  the  Marysville  people  bought  goods  in  the  East,  I  would 
have  to  pay  freight  from  San  Francisco  to  Marysville  to  compete 
with  them. 

Q.  If  that  is  true,  isn't  it  also  true  that  the  interior  merchants  get 
the  freight  that  goes  by  their  door  to  San  Francisco  and  back  again, 
making  a  double  freight?  A.  No,  sir;  the  goods  come  from  the  East 
directly  to  him,  and  do  not  go  to  San  Francisco  under  the  present 
system. 

Q.  Even  though  the  merchant  in  San  Francisco  is  importing  the 
articles?     A.  Yes,  sir. 

Q.  Is  that  not  a  system  where  the  railroad  company  permits  every 
man  in  Marysville  to  have  a  special  contract?  A.  An  open  contract. 
He  would  ship  to  the  Town  of  Marysville  direct. 

Q.  If  the  open  contract  was  too  high,  the  goods  would  be  shipped 
past  his  door  to  San  Francisco,  and  then  brought  back  again,  so  that 
the  Marysville  merchant  would  have  to  pay  twice?  A.  No,  sir;  the 
merchant  in  Marysville  would  be  as  he  is  at  the  present  time.  His 
goods  would  be  delivered  there.  We  could  have  forty  carloads  deliv- 
ered there.  We  could  ship  our  goods  from  the  East,  and  have  them 
delivered  anywhere  on  the  line  of  the  railroad  before  reaching  San 
Francisco.  If  they  aim  to  build  our  interior  merchants  up  and  make 
them  wholesale,  and  the  San  Francisco  retailers,  it  will  have  that 
tendencj7,  and  will  compel  our  San  Francisco  merchants  to  go  east, 
and  send  out  our  agents,  as  Chicago  and  other  places  are  doing  at  the 
present  time. 

Senator  Spencer — Don't  you  think  it  would  be  better  if  there 
was  no  such  thing  as  special  contracts,  and  that  everybody  shipping 
over  the  line  of  the  road  should  pay  their  just  proportion  of  freight, 
and  a  reasonable  charge  upon  that  freight,  at  any  point  to  which  it 
is  shipped,  either  to  San  Francisco  or  anywhere  else,  and  no  dis- 
crimination between  persons  except  a  reasonable  charge  for  trans- 
porting fast  freight,  and  let  them  ship  by  water  if  they  wanted  to,  or 
by  rail  if  they  wanted  to,  giving  the  merchants  that  privilege,  and 
leaving  out  all  considerations  of  special  contract,  or  persons,  or 
places?     A.  No,  sir. 

Q.  Don't  you  think  that  the  merchants  would  make  just  as  much 
money  if  they  had  to  ship  upon  the  same  terms  as  other  persons 
similarly  situated?  A.  That  has  been  discussed  by  the  railroad  com- 
pany and  by  the  merchants  whether  it  would  drive  the  trade  of  San 


159 

Francisco,  or  the  great  bulk  of  it,  around  the  Horn.  The  railroad 
company  have  had  three  or  four  different  lines  coming  in.  They 
must  have  that  trade  or  go  into  bankruptcy.  The  Northern  Pacific 
cut  off  the  northern  trade;  and  there  is  the  Central  and  the  South- 
ern, and  they  cannot  exist  unless  they  have  the  trade  of  San  Fran- 
cisco; and  if  they  have  to  put  on  a  tariff  the  effect  will  be  to  drive 
the  trade  around  Cape  Horn.  We  are  willing  to  try  it  that  way;  the 
San  Francisco  merchants  will  be  satisfied. 

Q.  I  understand  you  that  if  it  were  not  for  the  special  contracts 
all  freight  would  be  shipped  around  Cape  Horn?  A.  The  great  bulk 
of  them  would  be. 

Q.  That  would  be  the  most  of  the  heavy  bulky  goods?  A.  It 
would,  I  judge,  as  long  as  it  was  in  effect,  cause  certain  classes  of 
goods  to  go  around  the  Horn.  It  would  be  cheaper  to  send  goods 
by  rail  at  four  or  five  cents  a  pound,  than  to  send  them  around  the 
Horn  at  nine  dollars  a  ton. 

Senator  Whitney — Do  you  think  that  if  they  got  all  the  freight 
around  the  Horn,  it  would  be  just  the  same  as  if  it  were  all  brought 
by  rail?    A.  To  a  certain  extent. 

Q.  Do  you  think  it  would  be  advantageous  for  us  to  go  back,  as  it 
was  before  railroad  time,  and  for  the  benefit  of  this  State?  A.  Not 
for  the  freight  and  passenger  business.  The  railroad  has  brought  a 
great  many  persons  here,  and  the  State  is  filling  up  very  materially 
under  it,  for  the  State  depends  upon  the  population. 

Senator  Spencer — I  meant  (and  there  may  be  a  little  doubt  about 
my  last  question),  if  you,  as  a  merchant  of  San  Francisco,  saw  proper 
to  transport  goods  across  the  continent  by  rail,  that  you  should  have 
the  same  privileges  and  charges  granted  to  you  as  any  other  mer- 
chant, and  the  same  in  regard  to  all  those  places  in  the  interior  of 
the  State,  and  that  these  respective  merchants  should  have  the  same 
opportunities  to  ship  by  sea  if  they  wanted  to.  Wouldn't  that  be  the 
best  regulation  ;  wouldn't  that  regulate  itself,  as  between  the  mer- 
chants with  these  .'respective  contracts,  so  that  the  contracts  could  not 
have  a  tendency  to  change  the  rates  of  freights  and  fares,  and  the 
commerce  of  the  State?  A.  It  changes  it  in  this  respect;  it  takes  it 
from  the  overland  ;  to  a  certain  extent  it  helps  the  interests  of  the 
State.  They  make  more  money  from  freights  than  from  receipts  of 
fares.  The  more  freight  the  railroad  company  can  take,  the  cheaper 
they  can  take  fares,  and  thus  they  will  build  up  the  interest  of  the 
State.  I  don't  think  it  would  be  fair  to  the  merchants  of  San  Fran- 
cisco ;  I  don't  think  they  would  find  it  to  be  much  cheaper  to  ship 
around  the  Horn,  than  to  ship  overland.  I  understand  that  if, 
instead  of  five  hundred,  I  only  ship  fifty  carloads  by  rail,  I  should 
have  a  better  freight  than  the  merchant  of  the  interior  who  went 
around  among  his  friends  and  got  up  a  carload  of  freight,  and 
I   shipped  it  in  the  name  of  one  of  them  and  gets  the  same  rate. 

Q.  Would  the  merchants  of  the  State,  and  of  San  Francisco,  make 
the  same  money  every  year  if  the  rates  were  open  to  all  alike,  and 
they  could  ship  in  any  manner  they  chose?     A.  I  think  they  would. 

Senator  Murphy — Why  should  a  man  who  ships  five  hundred 
carloads  over  a  road  get  a  better  rate  than  a  man  who  only  ships  one? 


160 

A.  Because  it  is  the  best  men,  and  the  men  of  clear  intelligence  and 
judgment,  that  have  this  rate,  and  a  right  that  they  have  always  had 
in  the  past. 

Q.  Why  is  it?  It  does  not  cost  any  more  to  operate  a  road  with  five 
hundred  cars  than  it  does  with  one  ?  A.  I  differ  with  you  there.  You 
wTill  understand  that  a  railroad  company  look  at  it  in  a  different 
light.  If  you  apply  to  them  at  the  Willows  to  take  a  carload  of  grain 
to  San  Francisco,  and  they  have  nothing  else  to  take,  they  would  have 
to  charge  you  nearly  as  much  for  it  as  to  take  forty  for  me. 

Q.  That  is  true  where  you  take  an  isolated  case — where  they  have 
but  few  cars — but  on  a  great  overland  route  it  ought  not  to  cost  any 
more?  A.  Yes,  sir;  they  could  take  a  full  train  of  forty  cars,  and 
bring  it  through  to  San  Francisco  to  one  house  cheaper  than  they 
could  to  forty  houses. 

Q.  If  the  forty  houses  are  all  there  at  the  same  time?  A.  Yes,  sir  ; 
because  it  is  all  divided  out  into  forty  houses,  one  at  one  place  and 
one  at  another,  and  one  at  Marysville  and  one  at  Stockton,  and  they 
would  have  to  break  up  a  train,  and  stop  forty  times,  and  make  out 
forty  freight  bills;  and  there  is  a  great  deal  more  trouble  connected 
with  shipping  forty  carloads  to  forty  houses  than  to  one  house.  They 
bring  them  all  overland  and  divide  them  up  after  they  get  them  over 
here.  They  switch  them  off  at  Marysville  and  back  up  and  get  one 
car  there,  and  then  come  to  Sacramento,  and  switch  and  delay  there, 
and  get  one  out  for  Sacramento,  and  then  one  at  Stockton,  and  an- 
other to  San  Jose,  and  then  to  San  Francisco.  They  ought  to  have  a 
train  come  right  straight  through  to  San  Francisco  and  not  stop  at 
those  other  places  at  all. 

Senator  VroomAxV — Has  the  tendency  of  the  special  contract  sys- 
tem been  to  raise  or  lower  the  rates  of  freight  for  the  State?  A.  To 
lower  them. 

Senator  Murphy — In  holding  back  this  money  which  they  claim 
is  a  necessity,  is  it  not  done  "for  the  purpose  of  punishing  the  parties 
for  a  violation  of  their  contract?  A.  I  have  never  known  them  to 
do  so. 

Q.  They  don't  hold  it  and  then  go  out  and  hunt  up  these  parties? 
A.  No,  sir;  unless  they  think  they  have  sufficient  proof  that  the 
parties  have  violated  their  contract,  and  then  they  stop  right  there. 

Senator  Spencer — Do  you  ship  any  class  of  goods  by  these  special 
contracts  upon  which  you  sustain  a  loss?  A.  No,  sir;  I  don't  know 
as  we  have  to  sell  goods  at  a  loss  because  we  ship  them  overland. 
Sometimes  staple  goods  are  sold  at  a  loss  whether  shipped  by  railroad 
or  by  the  Horn. 

Q.  Do  you  know  whether  the  railroad  ships  that  class  of  goods  in 
order  to  stop  competition?    A.  I  don't  believe  that  they  do. 

Q.  If  ships  were  encouraged  to  come  here  from  New  York  they 
wrould  be  here  to  take  freight  back?    A.  Yes,  sir. 

Q.  By  their  not  being  encouraged  to  come  here  it  raises  the  prices 
of  freight  to  Europe,  does  it  not?  A.  The  more  ships  there  are  in 
San  Francisco  to  take  the  freight  the  less  the  rate  would  be. 

Senator  Vrooman — I  understood  you  to  state  that  there  were  a 
great  many  more  vessels  there  than  there  was  freight  for?  A.  Yes, 
sir,  three  to  one. 


161 

Q.  A  great  many  waiting  to  get  loads?  A.  They  could  get  it  but 
they  will  not  accept  the  freight.  They  expected  a  rate  of  about 
twenty-five  shillings  and  they  can  only  get  twenty.  That  arises  from 
the  fact  that  in  1881  they  had  a  large  amount  of  wheat  to  ship  and 
freights  went  up,  and  in  October  and  November,  1888,  the  San  Fran- 
cisco merchants  were  offering  fifty  shillings  for  vessels,  and  that 
attracted  them  from  all  parts  of  the  world,  and  when  they  came  they 
chartered  them  at  thirty  shillings. 

Q.  The  amount  of  wheat  was  not  so  great  as  they  supposed,  and 
the  market  of  Liverpool  declined,  and  they  could  not  afford  to  ship 
it  at  that  rate?     A.  No,  sir;  nor  at  the  present  rates,  either. 

Senator  Vrooman — I  suppose  that  'those  ships  cannot  afford  to 
take  the  rates  because  they  come  here  empty?  A.  It  is  very  seldom 
that  a  vessel  comes  without  a  cargo,  but  when  we  send  out  word  that 
a  vessel  can  get  fifty  shillings,  they  will  come  here  empty  from  China 
or  Australia;  but  if  they  come  here  expecting  fifty,  and  get  twenty- 
five,  they  will  not  take  it,  and  are  laying  up. 

Senator  Spencer — The  more  freight  they  brought  here  by  water, 
the  less  they  could  afford  to  take  the  freight  that  we  export?  A. 
There  has  been  plenty  of  freight  to  bring  them  here.  Any  quantity 
of  them  come  here  without  freight.  There  are  fifty  of  them  in  San 
Francisco  lying  idle  because  the  San  Francisco  merchants  cannot 
afford  to  pay  over  thirty-five  or  forty  and  leave  them  a  profit. 

Q.  A  ship  is  verjr  seldom  here  without  a  charter?  A.  No,  sir; 
sometimes  they  are  chartered  before  leaving  Liverpool. 

Q.  Sometimes  they  have  to  come  here  without  a  load?  A.  Some- 
times. 

Q.  If  those  ships  had  plenty  of  freight  to  bring  here,  then  they 
could  take  freight  back  for  less?     A.  Yes,  sir. 

Q,  How  do  you  reconcile  your  statements?  A.  These  ships  that 
are  in  San  Francisco  are  staying  there,  not  because  there  is  no 
freight,  but  because  they  will  not  accept  it  at  twenty-eight  or  thirty 
shillings.  Now,  will  it  help  the  freights  and  the  farmers  if  another 
hundred  ships  were  loaded  to  San  Francisco.  No;  it  would  only 
depress  the  market  and  the  price  of  grain. 

Senator  Del  Valle — When  those  ships  came  without  a  charter 
they  did  so  upon  the  assumption  that  there  was  going  to  be  a  great 
deal  of  wheat  to  be  shipped  ?  A.  Yes,  sir;  and  that  they  were  going 
to  get  fifty  shillings.  But  the  most  of  them  came  here  because  they 
were  chartered  to  come,  and  to  get  a  certain  rate  of  freight.  The 
charter  they  received  depended  upon  what  they  were  going  to  get. 
They  came  here  with  coal,  for  instance,  hoping  that  a  fifty  or  sixty 
shilling  freight  would  help  them  out. 


Statement  of  Hon.  C.  S.  Stephens. 

Mr.  Chairman:  I  don't  know  that  I  have  any  particular  state- 
ment to  make.  Of  course,  I  was  in  the  other  House,  and  worked  for 
the  passage  of  the  bill,  believing  it  to  be  a  beneficial  bill,  for  reasons 

11 b 


162 

that  were  satisfactory  to  me,  among  which  was  that  I  myself  had 
some  business  with  these  railroad  companies,  and  I  will  just  relate 
the  circumstance:  I  had  shipped  some  freight  from  New  York,  and 
desired  it  to  be  left  at  Stockton  ;  and  when  I  got  the  shipping  receipt, 
it  was  shipped  to  San  Francisco,  and  I  was  told  that  they  would  not 
leave  the  freight  at  Stockton  at  all.  It  was  a  piano,  and  it  went  on  to 
San  Francisco  and  came  back  by  the  boat.  I  felt  somewhat  aggrieved, 
because  they  could  have  favored  me  by  leaving  it  at  Stockton.  I 
would  have  been  perfectly  willing  to  have  paid  them  for  leaving  it 
there,  but  instead  of  that  they  took  it  to  San  Francisco,  which  was 
against  my  wish.  The  instrument  was  damaged  in  consequence,  by 
the  boat,  and  that  has  influenced  me  in  my  action  in  regard  to  this 
bill;  that  these  men  would  designedly  carry  that  freight  beyond 
a  terminal  point  for  the  purpose  of  compelling  me  to  pay  back 
freight  on  it.  and  for  that  reason  I  preferred  fetching  it  up  by  the 
boat.  A  gentleman  in  the  City  of  Stockton  told  me  that  they  were 
treated  in  the  same  way  in  regard  to  shipping  a  carload  from  Reno. 
They  had  to  pay  the  full  price  from  Reno  to  San  Francisco,  not- 
withstanding the  car  only  goes  to  Stockton,  and  they  have  got 
to  pay  that  price,  and  then  pay  eight  dollars  back  freight  besides. 
So  that  it  costs  them  eight  dollars  more  to  ship  a  carload  from  Reno 
to  Stockton  than  to  San  Francisco.  That  looks  to  me  like  it  was  not 
a  fair  business,  and  if  men  can't  be  persuaded  to  quit  it,  if  there  is 
any  power  in  legislation,  and  I  think  it  is  in  this  bill,  this  thing 
should  be  stopped.  That  is  the  reason  I  worked  for  the  bill,  and 
another  one  is  this,  that  came  under  my  own  notice:  I  refer  to  the 
Railroad  Commissioners.  When  they  were  in  Stockton  I  ap- 
peared before  them,  and  asked  them  to  inquire  into  it.  My 
son-in-law  purchased  a  piece  of  land  up  in  Tulare  County,  and 
desired  to  ship  up  some  lumber  to  build  a  little  house.  He  was 
a  poor  man.  He  went  first  to  the  agent  of  the  railroad  com- 
pany at  Stockton,  and  asked  him  what  they  would  charge  him  to 
ship  about  one  thousand  five  hundred  feet  of  lumber  up  to 
Tulare  County,  and  they  told  him  they  would  charge  him  just  the 
price  of  a  car;  I  think  it  was  from  forty-five  to  sixty  dollars;  and  a 
car  will  carry  eight  thousand  feet,  and  carries  ten  tons;  he  told  them 
that  he  only  wanted  to  carry  one  thousand  five  hundred  feet  of  lum- 
ber, that  there  was  not  enough  to  load  a  car,  but  they  wouldn't  take 
it  unless  he  paid  the  full  price  of  a  car,  which  would  be  forty-five 
dollars  for  eight  thousand  feet,  sixty  dollars  for  ten  thousand  feet. 
Then  my  son-in-law  says  to  him,  "Then  I  will  take  a  car  that  will 
carry  eight  thousand  feet  at  forty-five  dollars,  and  I  can  put  my 
household  goods  and  kitchen  furniture  on  it  also,  they  won't  weigh 
over  a  ton."  "  No,  you  can't  do  that,  you  will  have  to  pay  for  the 
use  of  the  car,  but  you  can't  put  those  things  on  it;  you  can  put  lum- 
ber on  it  and  nothing  else;  the  furniture  you  must  put  inside  of  a 
box  car."  He  said,  "Well,  let  me  put  my  family  on  and  take  them 
up,  and  it  will  not  make  a  load  the  whole  of  it."  "  No,  your  family 
must  not  be  on  an  open  car,  they  must  go  in  the  passenger  car." 
"Well,"  he  said,  "I  will  haul  the  traps  and  family  up  there  with  my 
horses;"  and  he  refused  to  do  it;  he  would  not  ship  at  all.     I  think 


163 

there  is  a  better  way  of  managing  railroads  in  the  interests  of  the 
people.  The  idea  of  making  a  poor  man  pay  the  same  price  for  ship- 
ping one  thousand  five  hundred  feet  of  lumber  that  you  would  make 
a  rich  man  pay  for  shipping  eight  thousand  feet,  I  don't  think  is  a 
proper  method  of  conducting  a  railroad  anywhere;  and  that  is  the 
reason  I  have  been  in  favor  of  some  bill  (it  don't  make  any  differ- 
ence whether  it  is  the  Barry  bill  or  what  bill  it  is),  to  regulate  and 
control  these  interests,  so  that  a  poor  man  can  have  his  rights  the 
same  as  a  rich  one. 

Senator  Del  Valle — When  did  this  discrimination  occur,  with 
reference  to  the  piano?    A.  About  six  years  ago. 

Q.  That  was  before  the  new  Constitution  was  passed  ?     A.  Yes,  sir. 

Senator  Sullivan— Has  anything  of  that  kind  ever  happened 
since?  A.  No;  because  I  have  not  shipped  anything;  but  these 
parties  told  me  a  week  ago  Tuesday,  that  they  generally  charged  that 
way  still. 

Q.  How  many  years  have  you  lived  in  Stockton?    A.  Twenty-two. 

Q.  During  that  time  have  you  known  the  railroad  company  to 
remove  its  track  for  the  purpose  of  discriminating  against  any 
locality?  A.  Nothing — only  what  I  heard.  Quite  a  number  of  mer- 
chants talked  with  me  at  the  time  the  Railroad  Commissioners  were 
there,  and  they  said  they  didn't  care  about  creating  hostile  feeling  with 
the  railroad  company  that  way,  and  they  preferred  not  to  go  before 
the  Commissioners,  and  one  reason  was  that  they  had  no  confidence 
in  the  Commission  anyhow. 

Senator  Reddy — I  understand  that  in  the  conversation  you  had 
with  the  merchants  at  Stockton,  they  came  to  the  conclusion  not  to 
prefer  any  charges  before  the  Commissioners,  for  the  reason  that  they 
thought  the  Commissioners  would  not  afford  them  any  relief?  A. 
Yes,  sir;  that  it  would  be  liable  to  lead  them  into  more  trouble; 
that  if  the  Railroad  Commissioners  did  not  interpose,  the  railroad 
company  would  come  down  on  them. 

Q.  What  do  you  mean  by  "coming  down  on  them" — discrimi- 
nating against  them?    A.  Yes,  sir. 

Q.  Then  the  merchants  of  Stockton  seem  to  labor  under  more  or 
less  fear  of  the  power  vested  in  the  railroad  company  of  discrimi- 
nating against  them?  A.  Some  of  them  do;  some  of  them  there 
don't  seem  to  be  much  afraid  of  them. 

Q.  What  proportion  of  the  merchants  that  you  talked  with  made 
that  declaration  or  joined  in  it?  A.  Well,  I  don't  remember  as  to 
the  number,  but  then  there  were  several  of  them. 


Statement  of  Hon.  A.  T.  Hatch. 

The  Chairman — Do  you  desire  to  make  any  statement?  Answer — 
I  will  make  this  statement:  That  we  are  favorably  located  for  ship- 
ping, and  have  no  cause  for  complaint.  There  is  water  by  which 
produce  can  be  shipped  from  our  stations.  I  will  say  that  all  the 
favors  I  have  ever  asked  from  the  railroad  company  I  have  received ; 


164 

so  I  am  not  the  one  to  growl  in  this  matter.  If  yon  want  men  to 
appear  before  you  that  the  railroad  company  have  harmed  I  do 
not  think  I  am  one  of  them.  I  have  not  been  cinched  by  them,  and 
I  am  not  in  favor  of  any  cinch  measures.  [Objection.]  I  do  not  use 
the  term  "cinch"  out  of  any  disrespect  to  the  legislators.  I  think 
that  there  is  one  thing  in  this  bill  that  would  work  a  hardship  to  us, 
unless  there  was  an  exception  maintained.  If  it  was  left  so  that 
those  who  had  large  quantities  of  grain  to  ship  could  command  the 
cars  for  too  long  a  period,  it  would  be  well  to  allow  those  having  live 
stock  or  fast  freight,  to  ship  it;  but  there  is  a  good  many  little  excep- 
tions to  that. 

Sknator  Del  Valle — Have  you  read  the  Barry  bill  carefully? 
A.  Not  as  carefully  as  I  would  have  done  if  I  had  known  that  I  was 
going  to  be  here. 

Q.  Don't  you  notice  that  that  exception  is  made  in  the  bill?  A. 
Not  in  that  way.     Is  that  the  only  exception? 

Q.  Live  stock  is  not  excepted  to  in  words  as  yet.  You  think  that 
such  an  exception  as  live  stock  ought  to  be  made?    A.  I  do. 

Q.  What  are  your  shipping  points?     A.  Saucelito  and  Cordelia. 

Q.  Have  you  competition  at  both  places?  A.  Possible  competition 
at  one  place  and  actual  competition  at  the  other. 

Q.  What  is  the  difference  in  freight,  from  the  points  where  there  is 
competition,  between  the  railroad  and  the  water?  A.  I  do  not  really 
know  what  the  water  freight  is;  I  never  use  it. 

Q.  Does  not  the  water  freight  give  as  satisfactory  accommodations 
as  the  railroad?    A.  No,  sir. 

Q.  Have  the  benefits  that  you  have  enjoyed  been  based  upon  the 
water  facilities  that  you  have?  A.  It  was  supposed  that  they  reduced 
all  their  prices  there  on  account  of  water  accommodations. 

Q.  You  are  a  farmer?     A.  Yes,  sir;  a  fruit  grower. 

Q.  You  ship  fruit  more  than  anything  else?     A.  Yes,  sir. 

Q.  By  the  carload?    A.  Sometimes,  and  sometimes  less. 

Q.  Do  you  have  any  special  rate?    A.  No,  sir. 

Q.  I  understood  you  to  say  that  you  received  other  benefits  from 
them?  A.  It  was  mostly  a  reduction  in  times  past.  Freights  are 
much  less  than  they  were.  I  asked  a  reduction  and  got  them  to  the 
city  on  fruits.  And  I  asked  the  carriage  of  full  cars  by  passenger 
train  to  Sacramento,  and  I  got  it  at  reduced  rates  for  eastern  ship- 
ments. 

Q.  Was  it  a  general  request  by  all  the  farmers  there  that  such  a 
reduction  should  be  made?  A.  Sometimes  it  was  one  farmer,  and 
sometimes  it  was  three  or  four;  at  times  it  has  been  made  for  all.  I 
never  asked  a  personal  favor. 

Q.  Have  you  had  any  experience  in  the  matter  of  special  contracts 
with  the  railroad  company?     A.  No,  sir. 

Q.  Are  you  aware  of  the  existence  of  such?     A.  Yes,  sir. 

Q.  Have  you  ever  seen  a  special  contract?     A.  No,  sir. 

Q.  Do  you  know  the  terms  of  one?     A.  I  do  not. 

Q.  If  such  a  contract  existed,  by  which  the  railroad  company 
bound  the  signers  to  send  their  freight  by  no  other  means  than  the 
railroad,  and  not  to  purchase  from  any  except  those  who  did  ship 


165 

through  them,  do  you  think  it  would  he  advantageous  to  the  best 
interests  of  the  State?    A.  No,  sir. 

Q.  If  such  a  system  as  that  did  exist,  would  it  not,  in  your  judg- 
ment, be  detrimental  to  the  shipping  interests  *of  the  State?  A.  It 
would. 

Q.  Have  you  been  among  the  agriculturists  of  the  State  in  any 
other  section  than  your  own?    A.  I  have. 

Q.  Have  you  conversed  with  them  in  reference  to  this  matter  of 
transportation?    A.  Somewhat. 

Q.  Have  you  been  through  the  San  Joaquin  Valley?  A.  I  had  no 
conversation  with  any  one  in  that  part.  I  was  there  about  two  years 
ago,  and  there  was  something  said  about  such  matters. 

Q".  You  have  talked  with  people  in  different  portions  of  the  State, 
in  your  capacity  as  President  of  the  Horticultural  Society?  A.  Yes, 
sir. 

Q.  Have  you  learned  the  general  opinion  of  the  people  in  regard 
to  the  transportation  question?  A.  There  are  a  great  many  people 
who  are  dissatisfied  with  the  present  system. 

Senator  Reddy — I  understood  you  to  state  that  you  had  no  cause 
of  complaint  against  the  railroad  company,  or  of  the  accommoda- 
tions that  have  been  afforded  to  you  ?    A.  I  clid. 

Q.  Where  is  your  place?  A.  At  Suisun,  Solano  "County,  and  in 
Cordelia,  Solano  County. 

Q.  You  have  water  communication  with  San  Francisco?  A.  Yes, 
sir. 

Q.  Do  you  attribute  your  happy  condition  of  things  to  the  water 
communication,  or  to  the  railroad  company?     A.  To  both. 

Q.  Honors  are  equally  divided  ;  they  are  easy  ?  A.  Our  freights 
would  not  be  so  cheap  unless  there  were  both.  The  water  would 
probably  be  more  expensive  than  it  is  if  there  was  no  railroad  there, 
and  vice  versa. 

Q.  Do  you  know  the  rates  that  are  paid  by  water  from  your  place 
to  the  city?  A.  Not  positively ;  I  think  it  is  less,  though,  than  is  paid 
by  rail.  I  think  that  the  rates  by  water  are  one  dollar  and  fifty  cents, 
and  by  rail  it  is  one  dollar  and  seventy-five  cents. 

Q.  The  people  of  your  place  are  all  at  peace  with  the  railroad?  A. 
Yes,  sir;  well,  there  is  one  man  that  has  not  been  at  peace.  He 
started  a  lawsuit  for  being  put  off  the  cars  several  times. 

Q.  I  mean  about  rates  of  freights  and  passenger  fares  ?  A.  I  don't 
know  of  any  dissatisfaction  there  very  recently. 

Q.  How  long  is  it  that  the  rates  of  freights  and  fares  have  been  sat- 
isfactory to  the  people?  A..  The  rates  were  put  down  to  the  present 
status  something  like  a  year  and  a  half  ago. 

Q.  Before  that  time  had  there  been  any  considerable  complaint 
about  freights  and  fares?     A.  It  was  tolerably  high. 

Q.  What  do  you  mean  by  "tolerably  high?"  Just  as  high  as  they 
could  possibly  stand  it?  A.  Not  quite;  but  when  we  asked  a  reduc- 
tion we  got  it,  and  that  was  on  one  particular  article  of  freight.  We 
gave  them  a  reason  why  it  should  be  less,  and  they  made  it  so. 

Q.  Was  there  any  competition  attached  to  that?    A.  No,  sir. 

Q.  Isn't  it  a  fact  that  the  railroad  company  agreed  with  your  ship- 


166 

pers  that  they  should  ship  all  their  freight  of  certain  classes  by  rail 
and  not  by  water?  A.  Nothing  of  the  kind.  I  never  heard  of  any- 
thing of  the  kind. 

Q.  Are  the  persons  who  ship  by  rail  permitted  to  ship  by  water 
without  any  consequences?  A.  I  have  never  shipped  any  other  way 
and  I  do  not  know. 

Q.  Why  have  you  not  shipped  by  water  if  the  rates  were  lower? 
A.  Because  the  time  was  an  object. 

Q.  Was  that  the  only  reason?     A.  And  the  regularity. 

Q.  Was  there  any  other  reason  ?     A.  No,  sir. 

Q.  Isn't  it  a  fact  that  you  were. informed  and  knew  that  if  you 
shipped  your  stuff  by  water  that  you  would  have  to  pay  higher  rates 
when  you  wanted  to  ship  by  rail  ?    A.  I  never  knew  that  it  was  so. 

Q.  Have  you  ever  tried  it?  A.  I  have  never  tried  it;  I  never  knew 
there  was  any  such  circumstance  existing. 

Q.  What  is  the  difference  in  time  in  delivering  your  freight  by 
water  and  by  rail?  A.  There  is  quite  a  great  deal;  I  don't  know 
how  much;  it  is  very  irregular ;  there  is  no  steam  communication 
by  water. 

Q.  Had  there  been  before  the  advent  of  the  railroad  ?  A.  There 
had. 

Q.  And  that  Was  the  way  that  the  fruit  was  moved  ?    A.  Yes. 

Q.  How  many  months  was  that  kept  up  after  the  advent  of  the 
railroad  ?     A.  About  ten  months. 

Q.  At  what  time  did  it  cease?    A.  Some  few  years  ago. 

Q.  Do  you  remember  how  long  ago  ?  A.  I  do  not.  Sometimes, 
for  a  few  months  at  a  time,  there  would  be  communication  by 
steamer,  and  then  it  would  go  off  again  directly. 

Q.  How  long  have  you  resided  at  that  place  ?    A.  Thirteen  years. 

Q.  In  what  business  have  you  been  engaged  ?  A.  Fruit  growing 
exclusively. 

Q.  If  there  is  any  discrimination  practiced  by  the  railroad  com- 
pany, it  is  in  favor  of  your  place  ?    A.  If  there  is  any,  yes,  sir. 

Q.  If  the  discrimination  works  your  way,  you  are  satisfied  with  it  ? 
A.  We  are  satisfied. 

Senator  Johnson — Are  you  advised  as  to  the  sentiment  of  Sonoma 
County  as  to  the  Barry  bill  ?     A.  No,  sir. 

Q.  Do  you  think  that  there  ought  to  be  any  discrimination  as 
between  persons  and  places  in  the  matter  of  the  shipment  of  freight? 
A.  That  can  be  construed  for  me  to  say  "  Yes,"  otherwise  I  would 
say  "  No."  There  are  peculiarities  here  that  might  cause  me  to  say 
"Yes."  Different  persons  might  in  different  places  be  so  situated 
that  there  would  have  to  be  a  difference  in  prices  to  make  it  right 
and  just. 

Q.  Do  you  stand  upon  the  San  Jose  platform?  A.  I  am  a  Repub- 
lican; but  I  am  not  much  of  a  politician. 

Q.  Do  you  recollect  that  provision  of  the  platform  adopted  by  the 
Democracy  that  there  ought  to  be  no  discrimination  between  persons 
or  places  as  to  freights?    A.  I  don't  know  anything  about  it. 

Q.  Do  you  not  think  that  the  words  "perishable  articles"  in  that 
clause  of  the  Barry  bill  will  satisfy  your  community  in  the  shipment 


167 

of  fruit  ?  A.  More  exceptions  than  that  would  be  necessary  to  my 
mind.  I  don't  know  what  would  satisfy  them.  I  know  that  I  might 
be  so  situated  that  I  would  not  be  satisfied  with  that. 

Q.  I  am  speaking  more  particularly  of  a  fruit-growing  section.  Do 
you  not  think  that  ought  to  satisfy  a  fruit-growing  section,  as  a  gen- 
eral thing?  A.  There  would  be  some  stock  raising,  and  live  stock 
would  not  want  to  lie  over  till  a  large  quantity  of  green  fruit  had 
been  shipped,  which  might  require  several  days  to  move  it. 

Senator  McClure — Have  you  read  this  Barry  bill?  A.  I  have 
read  it,  but  if  I  had  known  that  I  was  going  to  be  called  here  as  a 
witness  I  should  have  read  it  more  carefully  than  I  did. 

Q.  What  are  your  views  as  to  section  seven  of  the  bill,  and  of  that 
of  your  neighbors,  if  you  know,  in  respect  to  that  provision  in  the 
bill  as  to  the  effect  that  it  might  have  upon  your  community  ?  A.  I 
think  it  would  be  rather  damaging  to  a  community  where  they  had 
more  than  one  line,  if  they  had  a  water  monopoly. 

Q.  That  is  to  say,  that  if  they  dispatched  one  carload  ahead  of 
another  out  of  its  order,  they  would  subject  the  property  to  forfeiture? 
A.  Yes,  sir. 

Q.  Do  you  think  that  would  meet  the  approbation  of  the  com- 
munity in  which  you  live?  A.  I  don't  think  it  would,  of  the  think- 
ing portion  of  them. 

Senator  Sullivan — If  the  Barry  bill  will  have  the  effect  of 
protecting  the  people  by  law  from  unjust  exactions;  if  it  will  have 
the  effect  of  preventing  unjust  discriminations  as  against  individuals 
and  localities ;  if  it  will  have  the  effect  of  promoting  equal  services 
upon  equal  terms  to  all  persons,  would  you  not  say  that  it-is  a  good 
and  proper  bill?  A.  With  those  several  "ifs"  in  it  I  would  say 
"  Yes." 

Q.  Don't  you  think  you  could  be  more  explicit?  A.  Yes,  sir;  I 
think  by  putting  in  a  few  words  in  the  Barry  bill  I  could  make  it  do 
that. 

Q.  Let  us  hear  what  suggestions  you  have  to  make?  A.  In  regard 
to  discrimination  between  persons,  I  would  say:  "Who  were  simi- 
larly situated  at  the  same  places." 

Q.  Do  you  believe  that  there  should  be  any  discrimination  made 
as  between  persons  in  the  same  locality — between  man  and  man,  and 
between  persons  who  are  in  the  same  business?     A.  No,  sir. 

Q.  Supposing  you  could  send  a  certain  quantity  of  freight  to  San 
Francisco  for  two  hundred  dollars,  and  that  another  man  was  charged 
four  hundred  dollars  for  sending  the  same  quantity  to  the  same 
place,  do  you  not  think  that  would  be  unjust  and  unfair?  A.  It 
would  seem  so  to  inc. 

Q.  Now  if  it  could  be  shown  to  you  by  testimony  that  such  was 
the  practice  of  the  railroad  company  in  other  parts  of  California,  do 
you  not  think  that  any  law  that  could  be  passed  for  the  purpose  of 
remedying  that  defect  in  our  laws  would  be  a  good  and  proper  law? 
A.  I  do  not  see  any  reason  why  such  things  should  be  done.  I  can't 
see  how  it  would  be  right ;  it  may  be  right,  but  if  it  is  I  am  too  thick- 
headed to  see  it.     I  am  satisfied,  though,  that  it  has  been  done. 

Senator  Vrooman — I  understood  you  to  state  that  you  were  sat- 


168 

isfied  that  discriminations  between  persons  were  made?  A.  I  have 
been  so  informed  by  persons  and, papers,  that  they  have  special  con- 
tracts by  which  they  receive  special  rates  upon  entering  into  the  con- 
tracts. 

Q.  Does  your  answer  mean  anything  more  than  that  there  are 
such  things  as  special  contracts?    A.  Yes,  sir. 

Q.  You  think  that  special  contracts  are  discriminations?  A.  It 
appears  so  to  me. 

Q.  And  you  think  that  to  that  extent  they  are  unjust?  Would 
you  consider  that  special  contracts  were  discrimination  if  they  were 
open  to  all  similarly  situated?     A.  No,  sir. 

Senator  Taylor — You  are  a  member  of  the  State  Horticultural 
Society  and  Vice-President  of  the  society?    A.  Yes,  sir. 

Q.   Do  you  ship  a  great  deal  of  fruit?    A.  Yes,  sir. 

Q.  Do  you  know  what  the  rate  is  per  ton  upon  that  fruit  from  the 
place  where  you  ship  it  to  any  point  in  San  Francisco?  A.  Yes, sir; 
one  dollar  and  seventy-five  cents  per  ton.  I  think  it  is  seventeen 
dollars  for  a  car,  and  that  a  car  holds  ten  tons. 

Q.  What  is  the  distance  from  the  point  at  which  you  ship  to  San 
Francisco?    A.  About  fifty  utiles. 

Q.  Do  you  know  what  the  rates  are  per  ton  for  the  same  class  of 
fruit  from  Folsom  or  Sacramento?     A.  No,  sir. 

Q.  Do  you  know  any  other  point  from  which  fruit  is  shipped 
where  you  are  acquainted  with  the  rates?     A.  Vacaville. 

Q.  Do  you  know  the  rates  that  are  charged  from  there?  A.  Just 
twice. 

Q.  Just  twice  the  rates  from  Suisun?    A.  Yes,  sir. 

Q.  What  is  the  distance  from  Vacaville  to  San  Francisco?  A. 
About  twelve  miles.     That  is  the  difference  between  the  two  places. 

Q.  They  charge  you  twice  as  much  ?    A.  Yes,  sir. 

Q.  And  your  distance  is  twelve  miles  greater?    A.  Yes,  sir. 

Q.  Do  the  points  of  Suisun  and  Cordelia  have  competition  by  water? 
A.  Yes,  sir. 

Q.  Is  there  any  competition  from  Vacaville?     A.  No,  sir. 

Q.  Do  you  know  whether  or  not  they  charge  the  same  price  per 
ton  for  short  distances  that  they  do  for  long  distances?  A.  I  do  not 
know. 

Senator  Whitney — Upon  what  line  of  road  do  you  ship  from 
Suisun  to  San  Francisco?    A.  On  the  Central  Pacific  Railroad. 

Q.  Is  Vacaville  on  that  same  line?  A.  No,  sir;  it  is  on  another 
line  of  road  terminating  at  Elmira. 

Senator  Taylor — About  how  long  is  the  Vacaville  road?  A.  I 
don't  know;  about  four  miles. 

Q.  Do  you  know  whether  or  not  the  Auditor  of  the  Vacaville  road 
makes  his  report  to  the  Central  Pacific  Railroad  Company?  A.  I  so 
understand  it. 

Q.  Isn't  it  a  fact  that  that  road  is  under  a  contract  to  the  Central 
Pacific  Railroad  Company?     A.  Yes,  sir. 

Q.  Isn't  it  a  fact  that  the  freight  is  billed  right  through  from  Vaca- 
ville to  San  Francisco?     A.  I  don't  know. 

Senator  Murphy — You  live  in  Suisun?    A.  In  Suisun  Valley. 


169 

Q.  Do  yon  know  of  any  discrimination  in  charges  in  the  same 
classes  of  freight  between  different  persons?  A.  I  don't  know  such  to 
be  the  case. 

Q.  Did  you  ever  hear  any  complaint  in  your  neighborhood  in 
reference  to  the  order  in  which  freight  is  dispatched?     A.  I  did  not. 

Senator  Taylor — Did  you  ever  know  of  an  instance  where  they 
have  made  discrimination  between  persons  living  at  the  same  place 
and  shipping  from  the  same  point,  as  to  the  matter  of  the  dispatch  of 
freight  ?    A.  No,  sir. 

Q.  Have  you  ever  heard  of  any  difference  in  price  between  persons 
similarly  situated  ?    A.  They  are  the  same,  as  far  as  I  know. 

Q.  Are  you  in  favor  of  a  uniform  rate  per  ton  per  mile?  A.  lam 
in  favor  of  treating  all  just  alike,  as  near  as  possible,  without  favor 
to  any — that  would  be  charging  them  all  the  same  price. 

Q.  Per  ton  per  mile?  A.  I  don't  know  about  that;  I  think  there 
are  places  where  there  might  be  people  benefited  without  harm  to 
others. 

Q.  Would  you  consider  this  a  just  principle,  that  the  longer  the 
run  the  less  the  rate  per  ton  per  mile?  A.  I  think  that  would  be 
better  than  to  have  it  uniform. 

Senator  Reddy — You  know  nothing  about  the  views  of  your 
people;  you  are  only  speaking  for  yourself?     A.  Only  for  myself. 

Q.  Do  you  know  anything  about  the  rates  for  freight,  except  oh 
fruit?     A.  Yes.  sir. 

Q.  What  classes  of  freight  are  you  sending?  A.  Produce,  only. 
Fruit  manufactories  are  shipping  out  some. 

Q.  What  other  freights  are  you  acquainted  with?  A.  Green  fruit. 
All  products  that  come  from  there,  except  green  fruit,  are  at  a  uni- 
form rate.     I  believe  from  our  locality,  green  fruit  is  lower. 

Senator  Brooks— Do  you  think  it  would  be  in  the  interest  of  the 
fruit-growers  to  have  a  uniform  rate  per  ton  per  mile?  A.  I  don't 
know  how  to  consider  that.  There  are  some  points  now  that  it 
would  be  hard  upon  under  such  a  rule.  Freights  and  fares  are  less 
in  proportion  than  they  would  be  if  it  was  uniform.  Some  points 
nearer  pay  more  in  proportion  to  the  distance,  and,  therefore,  makes 
it  easier  on  those  that  are  at  a  distance,  and  although  they  pay  more 
than  the  near  ones,  they  do  not  pay  so  much  per  mile  per  ton. 

Q.  Do  you  think  it  would  be  in  the  interest  of  other  fruit-growers 
who  live  round  about  you  to  have  a  uniform  rate  per  mile  per  ton? 
A.  Yes,  sir. 

Q.  As  against  persons  living  in'the  mountains?    A.  Yes,  sir. 

Senator  Cross — Are  there  any  instances  within  your  knowledge 
which  might  make  it  cresirable  for  the  railroad  company  and  in  the 
interest  of  shippers  to  discriminate  as  to  freights,  as  to  which  should 
be  forwarded  first?     A.  Yes,  sir. 

Q.  Please  state  any  such  instances?  A.  I  don't  think  of  any  par- 
ticular instances,  but  circumstances  would  arise  every  day  where  it 
would  he  acts  of  justice  to  ship  some  goods  in  preference  to  others, 
although  they  had  no  priority  of  place. 

Q.  Could  you  make  the  matter  any  plainer  to  us?  A.  Well,  a  case 
of  live  stock,  or  a  family  moving  their  property  from  one  locality  to 


170 

another,  it  might  be  sent  first.  It  seems  to  me  that  is  plain  to  any 
man. 

Q.  Would  it  be  your  idea  that  live  stock  should  have  preference 
over  any  other  production,  and  what  other  production?  A.  I  think 
all  things  perishable;  all  live  stock. 

Q.  Why  do  you  think  live  stock  is  preferable  in  the  order  of  ship- 
ment over  anything  else  that  might  be  offered  before  them?  A. 
Simply  on  account  of  its  being  alive,  and  requiring  more  care,  and 
more  liable  to  damage  than  dead  freight  by  being  longer  on  the  cars, 
and  the  expenses  and  trouble  of  caring  for  them  at  the  stations  if 
they  are  not  on  the  cars,  would  make  it  burdensome. 

Senator  Reddy — You  spoke  of  families,  in  moving,  being  com- 
pelled to  wait  while  grain  might  be  forwarded.  Did  you  ever  know 
of  an  instance  of  that  kind  in  this  State?  A.  No;  but  it  might 
occur  under  the  provisions  of  this  bill. 

Q.  How  often  would  that  occur  in  California?  A.  It  would  prob- 
ably never  occur  unless  under  such  provisions. 

Q.  The  case  that  you  imagined  might  never  occur;  it  is  simply 
within  the  range  of  possibilities?  A.  It  is  probable  that  it  might 
occur  a  thousand  times. 

Q.  In  case  the  bill  goes  into  effect  you  apprehend  that  some  family 
will  be  delayed  in  getting  their  furniture  carried  ?  A.  That  was  a 
mere  simile  to  show  where  it  might  operate.  There  are  a  good  many 
others. 

Q.  Are  you  in  favor  of  allowing  railroads  to  discriminate?  A.  I 
think  there  is  a  kind  of  discrimination  that  is  necessary,  and  an 
unjust  discrimination  that  is  not  necessary. 

Q.  Do  you  desire  the  railroad  company  to  determine  which  is  a 
just  and  which  is  an  unjust  discrimination?    A.  No,  sir. 

Q.  Do  you  know  of  such  a  thing  ever  having  been  done  in  this 
State  as  an  individual  taking  all  the  cars  of  a  railroad  for  a  week  ? 
A.  They  had  no  law  like  this. 

Q.  As  it  is  there  now,  do  you  apprehend  that  it  will  be  done?  A. 
Those  will  be  the  rules  of  the  railroad  company. 

Q.  They  have  rules  now  against  discrimination  in  that  manner? 
A.  Yes,  sir ;  they  do  not  allow  it  so  much  now  as  this  law  would. 

Q.  You  would  rather  depend  upon  the  rules  of  the  company  in 
this  matter  than  upon  the  laws  of  the  State?  A.  No,  sir;  there 
might  be  fifty  small  lots  to  go,  and  such  a  man  as  Dr.  Glenn  could, 
at  one  time,  run  a  railroad  for  a  few  weeks. 

Q.  You  speak  about  possibilities  and  probabilities,  which  do  you 
mean  ?  A.  Actualities;  if  it  is  true  that  they  forfeit  their  charter,  if 
they  don't  do  it  as  a  penalty  for  not  doing  it.  * 

Q.  Do  you  know  of  an  instance  in  this  State  where  any  one  has 
kept  a  railroad  occupied  for  a  week?    A.  No,  I  do  not. 

Q.  Then  why  do  you  think  it  would  happen  if  the  Barry  bill 
passes?  A.  Because  the  penalty  is  that  they  must  do  so,  or  forfeit 
their  charter. 

Q.  You  spoke  about  the  rules  of  a  railroad  company  ;  where  have 
you  seen  any  rules?    A.  At  our  station. 

Q.  Your  experience  is  confined  to  Suisun?    A.  It  is  very  limited. 


171 

Q.  How  near  is  Suisun  to  the  Sacramento  River?  A.  About  fifteen 
miles. 

Q.  That  has  been  the  sum  of  your  experience  in  these  railroad 
matters  ?    A.  Yes,  sir. 

Q.  And  you  give,  as  your  opinion  from  that  experience,  that  the 
Barry  bill  is  good  for  the  State?    A.  No. 

Q,.  You  think  that  the  Barry  bill  will  not  operate  well  on  the 
affairs  of  the  State?     A.  I  don't  say  "yes"  to  that. 

Q.  Do  you  say  "no?"     A.  I  was  asked  for  my  opinion. 

Q.  Upon  what  do  you  base  whatever  opinion  you  have  ?  A.  On 
my  judgment. 

Q.  And  your  experience  at  Suisun  ?  A.  No,  sir  ;  on  my  judgment 
of  what  the  corporations  would  do  where  the  penalty  and  the  act  to 
do,  or  to  avoid  the  penalty,  enter  into  consideration. 

Q.  As  between  shippers,  would  you  have  the  first  come  first 
served  ?    A.  That  is  the  way  it  always  has  been. 

Q.  It  worked  well  ?     A.  Yes. 

Q.  Have  you  big  fruit  growers  been  able  to  crowd  out  the  little 
fruitgrowers?    A.  No,  sir. 

Q.  Wouldn't  it  work  the  same  way  in  other  things  and  other  farm 
products?    A.  Yes,  sir. 

Q.  Don't  you  think,  as  a  rule,  that  the  first  come  should  be  first 
served?     A.  Yes,  sir  ;  but  there  may  be  exceptions. 

Q.  Do  you  legislate  for  the  rule  or  for  the  exceptions  ?  A.  I  would 
avoid  those  exceptions  as  much  as  possible. 

Q.  You  would  not  forego  legislation  altogether?    A.  No,  sir. 

Senator  Sullivan — I  desire  to  know  if  you  have  ever  seen  the 
book  upon  which  the  tariff  is  kept  by  which  you  shipped  your 
freight  at  the  railroad  office?    A.  I  have  never  looked  into  it. 

Q.  You  went  to  the  agent  and  asked  him  ?    A.  That  is  all. 

Q.  Did  he  tell  you  without  examining  the  book?  A.  Certainly; 
he  was  so  used  to  it. 

Q.  Do  you  know  if  such  a  book  is  kept  by  the  agent  at 
Suisun  ?  A.  I  suppose  so.  Of  course  they  keep  it.  I  am  satisfied 
they  do. 

Q.  Don't  you  think  it  would  be  a  good  thing  to  have  a  book  of  that 
kind,  so  that  every  shipper  could  know  how  much  his  freight  was? 
A.  Certainly  it  would. 

Q.  Do  you  think  that  a  good  provision?    A.  Yes,  sir. 

Q.  Into  how  many  classes  is  fruit  divided  for  freight  purposes  ? 
A.  I  think  three,  but  ours  all  goes  at  the  same  rate. 

Q.  How  do  they  estimate  charges?  A.  By  weight.  They  have 
different  rates  on  fruit  shipments  east;  I  am  not  conversant  with 
that. 

Q.  What  distinction  is  made  between  dried  fruit  and  canned  fruit? 
A.  None;  I  think  there  is  no  distinction  made  for  shipment  to  the 
city. 

Q.  How  in  regard  to  shipments  east?  Q.  I  understand  that  green 
fruit  pays  the  most;  two  or  three  times  as  much  as  dried  fruit. 

Q.  What  is  the  reason  for  that?  A.  There  is  no  other  way  to  get  it 
there,  while  dried  fruit  can  go  another  way,  by  water. 


172 

Q.  On  account  of  lack  of  competition  they  can  charge  you  a  higher 
price?    A.  I  think  so. 

Q.  The  green  fruit  brings  a  higher  price  in  the  market?  A.  Not 
per  ton.     I  don't  know  bat  it  does  in  the  East. 

Q.  That  is  one  of  the  reasons  for  the  extra  charge,  is  it  not? 
A.  Because  it  depreciates,  or  because  it  brings  a  better  price? 

Q.  Because  the  value  is  greater  in  the  market;  that  enters  into  the 
charge  also?     A.  It  is  possible. 

Senator  Johnson — If  there  is  to  be  any  classification  of  fruit 
with  reference  to  its  being  forwarded  with  dispatch,  don't  you  think 
it  would  be  advisable  to  have  it  in  the  bill?  A.  It  would  be  well,  if 
the  bill  was  right.  I  think  it  can  be  done  properly;  this  bod}'  can 
do  it. 

Q.  Who  wrould  you  suggest  to  make  the  classification?  A.  I  think 
this  body  is  competent. 

Q.  As  between  the  railroad  and  the  Railroad  Commissioners,  which 
would  you  sooner  trust  with  the  classification?  A.  Well,  I  believe  I 
would  prefer  to  trust  the  railroad.  I  never  was  in  favor  of  a  Hail- 
road  Commission. 

Senator  Cross — Is  there  any  difference  in  the  necessity  for  speed 
in  the  transportation  of  different  kinds  of  fruit?    A.  Yes,  sir. 

Q.  Which  requires  to  be  forwarded  with  the  greater  speed? 
A.  Green  fruit.  * 

Q.  Explain  why?    A.  On  account  of  its  being  more  perishable. 

Q.  Which  requires  to  be  handled  with  the  greater  care?  A.  Fruit 
is  not  handled  by  the  railroad  company  or  its  employes — not 
touched;  it  is  loaded  at  the  expense  of  the  shipper,  and  unloaded  at 
his  expense. 

Q.  Do  green,  canned,  and  dried  fruits  have  the  same  accommoda- 
tions?   A.  Green  fruit  is  sent  by  slow  freight. 

Q.  When  you  speak  of  green  fruit  paying  two  or  three  times  as 
much,  do  you  mean  that  which  goes  as  fast  freight?  A.  Green  fruit 
goes  about  the  same  rate  of  speed  and  pays  twice  as  much  as  dried 
fruit  or  canned  fruit,  and  itgoes  in  a  similar  car. 

Q.  How  is  it,  as  between  fruit  that  goes  at  the  greatest  speed,  or  as 
freight,  and  the  ordinary  rate  ?    Q.  That  is  about  three  times  as  much. 


Letter  from  John  T.  Doyle. 

Menlo  Park,  April  14,  1884. 

My  Dear  Sir:  I  have  said  to  you  before  that  if  any  committee 
of  the  Legislature  desires  my  presence  in  Sacramento  for  informa- 
tion or  consultation,  I  will  go  there.  But  I  object  to  being  put  in  the 
position  of  a  lobbyist,  even  for  a  public  object,  and  have,  therefore, 
replied  to  your  letter  and  telegram  that  I  decline  to  go  as  a  private 
solicitorfor  legislation.  I  added  my  emphatic  opinion  that  the  Barry 
bill  is  a  just,  wise,  and  much-needed  measure.  What  more  could  I 
say,  unless  asked" by  authority? 


173 

I  went  over  the  bill,  as  it  passed  the  House,  carefully,  section  by 
section.  It  deals  with  and  affirms  general  principles,  the  justice  or 
injustice  of  which  can  be  determined  by  plain  people.     These  afe: 

1.  That  railroads  constructed  by  authority  of  law  are  public  high- 
ways. 

2.  That  the  corporations  charged  with  the  management  of  those 
highways  are  charged  with  the  performance  of  a  public  duty. 

3.  That  in  the  discharge  of  such  duty  they  are  to  deal  impartially 
with  nil  applicants.     There  is  to  be  no  privileged  class. 

4.  That  corporations  created  by  authority  of  State  laws  must  live 
up  to  the  law  of  their  organization  or  cease  to  live  under  it. 

These  are  the  principles  on  which  the  bill  is  framed  ;  and  I  think 
the  people  of  this  State  will  watch  with  interest  the  publication  of 
the  yeas  and  nays  which  will  show  which  of  their  representatives 
ventures  to  deny  any  one  of  them. 

I  have  read  all  the  objections  stated  to  have  been  urged  to 
the  bill  before  the  Senate  committee.  They  are  all,  so  far  as  I 
observe,  based  on  the  supposition  that  most  strange  and  improbable 
circumstances  will  occur,  in  which  case  inconvenience  or  evil 
might  result  from  the  rules  laid  down.  One  gentleman,  for  instance, 
apprehends  that  he  may  suddenly  be  called  upon  to  transport 
thirty  carloads  of  lumber  in  preference  to  an  equal  quantity  of 
wheat  arriving  a  few  moments  later.  His  road  has  been  in  opera- 
tion now  over  sixteen  years,  and  an  equipment  of  two  locomotives 
and  eighteen  freight  cars,  all  told,  has  hitherto  sufficed  to  do  the 
whole  business.  Let  us  hope  that  the  general  rule  of  gradual 
growth  of  population  and  business  will  not  be  so  grossly  violated 
in  his  neighborhood  as  he  apprehends.  Another  fears  that  for  a 
casual  error  or  misconduct  of  a  Superintendent,  or  a  local  agent, 
the  Attorney-General  will  be  malicious  enough  to  demand,  and 
the  Courts  foolish  enough  to  grant,  a  forfeiture  of  charter.  The 
public  will  hardly  share  his  apprehensions.  The  punishment  of 
offenses  against  the  public  has  never  been,  and  is  not  likely  to  be, 
conspicuously  severe  in  this  State.  No  man  who  does  his  duty 
according  to  the  law  of  the  land  need  ever  fear  prosecution,  much 
less  conviction,  for  the  unauthorized  acts  of  his  employes.  A  third 
gentleman  suggests  that  the  removal  of  a  temporary  trellis  and  sub- 
stitution of  a  solid  embankment  may  violate  the  requirement  to 
maintain  structures  in  a  state  of  equal  efficiency,  etc.,  for  the  pur- 
poses for  which  they  were  designed.  By  and  by  he  will  realize  that 
"the  greater  includes  the  less,"  and  that  in  law  what  is  superior  to  a 
trellis  will  be  deemed  by  Courts  equal  to  it. 

These  objections  are  simply  puerile.  The  proof  that  they  are  not 
seriously  thought  of  by  those  who  urge  them  is  that  they  offer  no 
amendment  to  meet  the  supposed  contingencies.  The  attempt  to 
formulate  such  an  amendment  would  expose  the  absurdity  of  the 
supposition.  The  rule  of  impartiality  must  either  be  affirmed  or 
denied  in  toto.  If  denied,  the  railroad  companies  are  left  to  prac- 
tice such  and  so  much  discrimination  as  they  please.  If  affirmed, 
and  an  isolated  case  of  hardship  should  arise,  we  must  trust,  as  we 
do  in  other  cases,  to  the  good  sense  of  public  officers,  and  Judges,  and 


174 

jurors,  to  meet  the  emergency.  Equal  rights  over  public  highways, 
and  in  public  conveyances,  is  doubtless  the  law  now.  Was  any  one 
ev%r  prosecuted  for  giving  preference  to  perrons  who  were  infirm 
and  helpless?    What  chance  would  such  a  prosecution  stand? 

Mr.  Hawley,  I  observe,  puts  his  objections  on  other  grounds.  Prac- 
tically, his  objection  is  that  if  this  bill  passes  it  will  break  up  the 
"special  contract  system,"  which  he  favors. 

Mr.  Hawley's  house  is  one  of  the  most  extensive  in  the  State.  His 
importations  amount  to  millions  in  the  course  of  the  year.  He  is  of 
opinion,  that  for  that  reason,  he  ought  to  pay  less  rates  for  the  same 
service  than  those  charged  to  younger  and  less  prosperous  concerns. 
While  I  admire  his  frankness  in  this  suggestion,  I  think  he,  and  the 
few  large  houses  similarly  situated,  will  be  alone  in  admitting  its 
correctness.  It  exhibits  forcibly  the  radical  objection  to  the  whole 
system  of  discrimination  which  finds  expression  in  these  special 
contracts,  viz. :  That  it  creates  at  once  a  class  of  privileged  persons, 
distinct  from  the  rest  of  the  community.  By  the  exercise  of  it,  the 
railroad  companies  have  power  to  select  which  men  in  a  particular 
place  may  do  business  at  a  profit,  and  which  may  not,  and  thus 
reduce  the  whole  trading  community  to  a  state  of  practical  servitude. 
For  obvious  reasons,  they  prefer  to  build  up  one  large  concern  to  a. 
dozen  small  ones,  and  the  tendency  and  effect  of  their  policy  of  dis- 
criminations, therefore,  is  to  concentrate  all  commercial  business  in 
the  hands  of  a  few  large  houses.  One  monopoly  thus  draws  round 
itself  a  dozen  subordinate  ones  each  tributary  to  it.  -  The  rest  of  the 
commercial  community  is  relegated  to  the  position  of  a  body  of 
•petty  traders,  who  pick  up  a  precarious  support  by  the  permission  of 
the  great  houses  which  enjoy  the  favor  of  the  railroad  companies. 

Such  a  state  of  things  may  be  found  unobjectionable  to  those  who 
possess  large  capital,  and,  therefore,  fall  within  the  privileged  class, 
but  it  is  destructive  to  the  prosperity  of  the  State ;  for  the  simple 
reason,  that  its  tendency  and  effect  are  to  make  the  rich  richer  and 
the  poor  poorer.  There  is  but  one  safe  principle  to  follow  in  relation 
to  these  public  roads,  the  use  of  which  is  essential  now  in  the  daily 
life  of  all  men,  and  that  is  absolute  impartiality.  The  maxim  that 
we  are  all  equal  before  the  law,  is  the  cornerstone  of  our  whole 
system  of  government.  Why  should  it  not  apply  to  public  high- 
ways? What  reason  can  be  rendered  to  the  contrary  ? 
Yours,  very  respectfully, 


JOHN  T.  DOYLE. 


Hon.  Thos.  F.  Barry. 


Second  Letter  from  John  T.  Doyle. 

Menlo  Park,  April  15,  1884. 

My  Dear  Sir:  In  addition  to  what  I  then  said,  I  would  like  to 
add  a  few  words  on  certain  sections  of  the  bill: 

The  requirements  of  section  three  are  leveled  against  such  nefari- 
ous proceedings  as  the  destruction  of  the  wharf  at  Santa  Monica.    It 


175 

was  a  magnificent  structure,  several  hundred  feet  long,  with  a  depth 
of  water  for  the  largest  vessels,  railroad  laid  on  it  extending  direct 
to  Los  Angeles,  stationary  engines,  and  all  facilities  for  unloading  a 
large  steamer  in  four  hours.  It  was  built  by  a  railroad  company 
organized  under  the  laws  of  this  State,  and  by  authority  of  the  same. 
The  stock  of  the  company  was  afterwards  bought  up  by  people  con- 
trolling a  rival  line  of  transportation,  having  much  inferior  facilities 
(viz.,  lighters  at  Wilmington],  and  deliberately  destroyed;  not  suf- 
fered to  decay,  but  willfully  destroyed.  For  the  truth  of  this  state- 
ment I  refer  to  Governor  Stoneman,  from  whom  I  had  it.  I  learn 
recently,  that  a  similar  act  of  vandalism  has  occurred  at  Santa  Cruz, 
and  was  perpetrated  by  another  railroad  concern.  I  think  there  is 
no  other  civilized  country  in  the  world  where  such  an  act  would  not 
send  its  perpetrator  to  prison.  Such  things  are  crimes  against  civil- 
ization. Richelieu's  stone  blockade  of  La  Rochelle,  though  done  by 
the  authority  of  the  sovereign,  and  as  a  war  measure  against  armed 
rebels,  has  been  condemned  by  all  history  as  infamous.  These  acts 
were  done  in  profound  peace,  and  by  corporations  deriving  their 
leave  to  exist  from  the  laws  of  the  very  people  against  whose  best 
interests  they  were  directed.  Should  there  or  not  be  a  law  to  forbid 
such  infamies? 

Section  four  is  a  provision  necessary  to  keep  the  State's  control  of 
its  own  corporations.  In  various  actions  brought  by  the  State  against 
the  Central  Pacific  and  Southern  Pacific  Railroad  Companies,  they 
have  pleaded  that  they  have  derived  certain  privileges  from  the 
General  Government,  and  have  been  made  Federal  corporations,  and 
thus  exempt  from  State  control  and  State  taxation.  Some  months 
ago  the  Southern  Pacific  Company  moved  heaven  and  earth  to  get  a 
Federal  charter  from  Congress,  which  the  Legislature  remonstrated 
against.  Lately,  I  see  Connecticut  has  granted  a  charter,  under 
which  an  attempt  may  be  made  to  consolidate  in  some  way  all  con- 
necting roads,  including  the  Southern  Pacific.  It  is  evident  these 
companies  intend  to  escape  all  State  control,  if  possible,  and  the 
Legislature  should  be  forehanded  with  them,  and  prohibit  all  such 
proceedings.  From  the  moment  the  State  gives  up  the  absolute  con- 
trol of  its  own  corporations,  and  its  own  highways,  it  loses  its  inde- 
pendence and  its  autonomy.     Yours  truly, 

JOHN  T.  DOYLE. 

Hon.  Thos.  F.  Barry. 


Letter  prom  John  F.  Kidder. 

Nevada  County  Narrow  Gauge  Railroad,        j 
Superintendent's  Office,  Grass  Valley,  April  12,  1884.  j 

Hon.  C.  W.  Cross,  Sacramento,  California: 

Dear  Sir:  As  I  am  unable  to  personally  appear  before  the 
Judiciary  Committee  of  the  Senate,  in  reference  to  the  proposed 
legislation  regarding  the  railroads  of  California,  and  as  the  "  Barry 
bill "  has  been  so  thoroughly  ventilated,  that  it  would  seem  super- 


176 


fluous  to  give  my  opinion  of  the  injury  said  bill  would  cause,  not 
only  to  the  railroads  but  to  the  general  public,  I  therefore  desire  to 
give  you,  briefly,  the  facts  in  regard  to  our  own  narrow  gauge  rail- 
road, as  to  its  construction,  value  of  the  investment,  and  reasons  why 
the  State  should  not  interfere  with  it. 

The  Nevada  County  Narrow  Gauge  Railroad  Company  was  organ- 
ized under  a  special  charter  of  the  State  of  California  (a  copy  of 
which  is  hereby  submitted),  granting  said  company  the  right  to 
charge  certain  rates  of  freights  and  fares,  greater  than  those  author- 
ized by  the  general  law  of  the  State.  Without  such  provision,  it 
would  have  been  impossible  to  procure  the  necessary  capital  to  build 
said  road,  as  no  one  would  have  been  foolish  enough  to  invest  their 
money  with  a  certainty  that  under  the  general  law,  or  rather  the 
rates  allowed  by  that  law,  there  would  have  been  no  return  for  their 
investment.  The  cost  of  the  road  and  equipment  has  been  to  the 
present  time,  $60S,559  88,  as  follows  : 


1882. 

1883. 

Cost  of  construction  and  equipment .  

$595,522  02 

8,945  23 

935  64 

],823  22 

$59S,52l  55 
9,102  69 

935  64 

Total. 

$607,226  21 

$608,559  88 

The  money  to  build  the  road  was  subscribed  locally,  and  no  dona- 
tions of  either  State  or  county  aid  were  asked  or  given.  The  enter- 
prise has  been  a  blessing  to  the  people  along  the  line  of  the  road,  and 
up  complaints  have  ever  been  made  or  reductions  asked  in  any  of 
the  charges  made  for  passenger  or  freight  traffic.  There  have  been 
three  (3)  dividends,  of  three  per  cent  each,  on  the  capital  stock, 
amounting  to  a  sura  total  of  twenty-one  thousand  seven  hundred 
and  ninety-eight  dollars,  since  the  opening  of  the  road  in  April, 
eighteen  hundred  and  seventy-six,  which  is  all  the  return  the  stock- 
holders have  received.  The  gross  receipts  for  each  year  of  operating 
the  road,  as  given  below,  show  that  the  business  is  rapidly  decreasing 
since  eighteen  hundred  and  eighty-one,  with  a  probability  that  the 
present  year  will  show  a  much  larger  decrease.  This,  as  you  well 
know,  is  owing  to  the  suspension  of  hydraulic  mining: 


Yeaus. 

Mileage  of 

Locomotives. 

Gross  Receipts. 

1876  (April  17  to  December  31) 

33.957 
49.444 
50,744 
52,261 

68,148 
75.(152 
67,671 
61,612 

$70,760   26 

1877 ._ 

90,5  IS  60 

1878 

98,085  97 

1879 

101,949  24 

J8S0 

1  ! 5,655   55 

1881 

116.465   81 

1882 

105.273  20 

1883 

100,978  07 

177 

At  the  same  time,  the  expenses  for  operating  are  greatly  on  the 
increase,  owing  to  the  necessary  renewals  of  bridges,  superstructures, 
rails,  cars,  and  motive  power.    I  append  the  income  account  of  1883: 

INCOME  ACCOUNT,  18S3. 

Gross  earnings $100,978  07 

Dividend,  Citizens'  Bank  stock 1 18  72 

Total $100,996  79 

Excess  of  expenses  over  income ,--  574  97 

Total $101,571  76 

Total  operating  expenses $S0,771   76 

Interest,  bonded  debt - 20,800  00 

Total $101,571  76 

I  scarcely  deem  it  necessary  to  dilate  on  the  facts  as  I  have  shown 
them,  but  I  would  ask,  can  the  great  State  of  California  ignore  its 
contract  with  us,  and  force  us  to  suspend  operating  our  road. 
Your  obedient  servant, 

JOHN  F.  KIDDER, 

President  and  Manager. 


Letter  from  W.  F.  Whittier. 

San  Francisco,  April  15,  1884. 

To  the  Judiciary  Committee,  Senate  Chamber,  Sacramento  : 

I  duly  received  your  letter  of  the  tenth  instant,  inviting  me  to 
appear  before  your  committee  and  give  my  views  regarding  the  Barry 
bill.  I  am  very  sorry  to  say  that  not  only  pressing  business,  but  the 
state  of  my  health,  will  prevent  my  leaving  home  at  present. 

I  have  only  given  the  bill  a  cursory  examination,  which,  however, 
is  sufficient  to  convince  me  that  it  is  open  to  objections. 

Perhaps  it  would  be  well  for  me  to  say  that  my  firm — Whittier, 
Fuller  &Co. — is  not,  nor  has  it  ever  been,  under  contract  to  ship  any, 
or  all,  its  goods  by  rail.  We  conduct  our  business  in  our  own  way, 
shipping  such  goods  by  rail  as  it  seems  to  be  to  our  interest  to  ship 
that  way,  and  choosing  any  other  route  at  pleasure. 

Generally  speaking,  with  regard  to  legislation  on  railroads,  I  will 
say  that  it  seems  to  me  that  all  discriminations  between  persons  and 
places,  which  have  for  their  object,  or  are  likely  to  produce  the  effect 
of  favoritism  by  the  carrier,  to  create  conditions  which  do  not  now 
exist,  such  as  contracting  their  business  into  the  hands  of  one,  or  of 
a  few  persons,  as  against  the  rest  of  the  community,  or  as  diverting 
the  trade  from  one  point  to  another  point  viewed  witli  more  favor  by 
the  persons  operating  railroads,  should  be  prohibited,  and  the  car- 
riers so  restrained  as  to  make  it  impossible. 

On  the  other  hand,  it  is  the  result  of  my  own  experience  in  busi- 
ness that  discriminations,  per  se,  are  not  always  unjust.  The  laws  of 
trade  recognize  this.     Indeed,  I  might  say  that  discrimination  may 

12b 


178 

be  regarded  as  second  only  to  competition  in  its  contribution  to  the 
life  of  trade.  It  should  be  recognized,  too,  that  there  are  natural 
conditions  which  give  one  place,  on  account  of  its  location,  the 
advantage  over  another  place,  and  it  is  also  true  that  there  are  per- 
sons— merchants,  producers — who  by  their  tact,  industry,  and  appli- 
cation, do  possess  advantages  over  their  neighbors.  Common 
•carriers,  while  restrained  from  creating  such  conditions,  it  seems  to 
me,  should  not  be  allowed  to  destroy  them.  My  conclusions  might, 
perhaps,  be  summed  up  in  this:  That  having  provided  such  legisla- 
tion as  will  prevent,  or  punish,  unjust  discrimination  in  favor  of 
persons  or  places,  there  should  remain  the  greatest  possible  freedom 
to  both  carrier  and  shipper,  for  the  purpose  of  the  development  and 
extension  of  trade. 

It  seems  to  me  that  the  first  section  of  the  Barry  bill  is  vague  and 
indefinite,  to  the  extent  that  it  is  likely  to  be  mischievous.  We  have 
been  large  shippers  for  years  over,  perhaps,  all  the  transportation 
lines  in  this  State,  and  have  never  yet  experienced  partiality,  dis: 
crimination,  preference,  or  favor  in  the  matter  of  dispatch,  speed,  or 
accommodation,  or  prices;  nor  have  we  ever  had  occasion  to  com- 
plain of  these  things  being  done  against  us  in  favor  of  others.  I  don't 
know  that  the  section  referred  to  goes  any  further  in  restraining  these 
acts  upon  the  part  of  the  carriers  than  the  Constitution.  I  doubt  it 
materially. 

I  note  a  provision  that  all  freight  shall  be  dispatched  and  for- 
warded in  the  order  in  which  it  is  received  or  tendered  for  transpor- 
tation. So  far  as  our  firm  is  concerned  we  have  never  experienced 
the  necessity  for  any  such  legislation.  I  can  see,  however,  how  it 
might  be  made  an  excuse  by  the  carriers  for  putting  the  shipping 
public  to  a  very  great  deal  of  inconvenience.  In  many  cases  it  could 
concentrate  the  business  of  the  State  in  the  hands  of  a  few,  for  a 
time,  at  least. 

I  doubt  very  much  if  the  interest  of  the  carriers,  conceding  that 
they  proceed  from  a  not  altogether  enlightened  spirit  of  selfishness, 
would  permit  them  to  discriminate  in  the  matter  of  forwarding  freight. 
On  the  other  hand,  I  can  see  where  an  ironclad  rule  of  the  nature 
provided  in  this  section,  would  be,  not  only  a  cause  of  inconvenience 
to  the  public,  but  the  source  of  much  litigation.  No  rule  should  be 
established  that  would  permit  me,  with  a  large  tonnage  to  be  moved, 
to  engage  the  facilities  of  a  carrier  for  my  exclusive  benefit,  for  even 
a  short  period.  There  are  shippers  who  can,  and  often  have,'  tonnage 
amounting  to  thousands  of  tons,  that  sometimes  can  be  suddenly 
thrown  upon  the  carrier,  monopolizing  its  facilities  for  a  time,  long 
or  short,  to  the  exclusion  of  others. 

The  interests  of  the  carrier  are  such  as  to  prompt  it  to  prevent  this 
as  much  as  possible.  Under  the  law,  as  proposed,  the  carrier  would 
have  no  option  in  the  matter.  I  think  that  the  bill  would  be  im- 
proved by  eliminating  that  portion  altogether. 

As  to  section  second,  I  question  very  much  the  expediency  of  for- 
bidding, absolutely,  all  discounts,  rebates,  special  contracts,  special 
rates,  or  other  devices  for  charging  more  or  less  than  the  published 
rates.     It  seems  to  me  that  a  prohibition  of  unjust  discriminations, 


179 

preferences,  or  favors  in  the  interest  of  certain  persons  or  places, 
would  be  sufficient. 

In  the  matter  of  special  contracts,  as  I  have  said  before,  my  firm 
has  not  been  under  contract  with  any  of  the  railroad  companies  in 
this  State.  I  know  that  the  contract  plan  enforced  on  through  busi- 
ness has  been  the  subject  of  a  great  deal  of  criticism.  It  has  not  been 
handled  by  the  railroad  compare  as,  perhaps,  I  should  have  handled 
it.  At  the  same  time,  perhaps  every  one  of  my  fellow  merchants 
would  suggest  a  plan  as  different  from  mine  as  mine  would  be  from 
that  of  the  railroad  company's. 

I  cannot  see  that  these  special  contracts  have  been  detrimental  to 
the  interests  of  the  State.  If  thej^  have  worked  a  hardship  in  any 
sense,  it  has  been  against  the  interests  of  the  merchants  of  San 
Francisco,  in  that  it  has  given  the  interior  merchants  the  facilities 
and  advantages  which  were,  before  the  opening  of  the  railroad,  en- 
joyed, wholly  and  exclusively,  by  the  merchants  of  San  Francisco, 
by  reason  of  its  seaport. 

There  is  no  question  but  that  it  has  had  a  tendency  to  reduce 
freights.  There  is  no  doubt  in  my  mind  but  that  if  the  railroad 
companies  had  been  able  to  offer  me  rates  which  I  could  see  were, 
upon  the  whole,  equal  to  those  my  firm  enjoys  by  the  use  of  all  three 
routes,  I  should  have  been  glad  to  have  made  a  contract. 

I  should  like  to  see  the  wholesale  principle  recognized  by  the  car- 
riers, as  it  is  recognized  by  merchants  and  traders  in  their  dealings 
with  each  other.  It  strikes  me  that  a  principle  so  universally  recog- 
nized in  trade  ought  to  be  observed  in  the  conduct  of  such  a  poten- 
tial factor  in  trade  as  the  transportation  interest  has  become.  All 
the  rates,  privileges,  and  facilities  offered  by  a  carrier  ought  to  be 
open  to  all  persons  upon  the  same  terras,  but  it  strikes  me  that  the 
carrier  is  precisely  in  my  position.  It  has  transportation  to  sell, 
while  I  sell  paints  and  oils.  A  customer  who  will  buy  an  invoice 
running  into  the  thousands,  will  certainly  receive  a  discount  from 
me,  and  from  all  of  my  competitors,  from  the  rates  that  I  would  sell 
for  to  the  purchaser  of  an  invoice  of  a  hundred  dollars. 

I  am  not  prepared  to  say  that  it  is  practicable,  and  I  do  not  know 
that  your  honorable  committee  will  regard  it  as  expedient,  from  the 
standpoint  of  public  policy,  but  I  cannot  see  why  the  carrier  should 
not  be  allowed,  or  rather  why  it  should  not  be  obliged,  to  pursue  the 
same  principle,  for,  certainly,  it  can  afford  to  do  so.  In  other  words, 
it  appears  to  me  that  just  as  I  can  handle  my  goods  and  turn  them 
over  in  large  lots  at  a  lower  price,  and  make  the  same  percentage  of 
profit  as  in  smaller  lots  at  higher  price,  so  the  carrier  can  handle 
large  lots  of  goods  for  one  individual  at  a  lower  rate  and  yet  make 
the  same  percentage  of  profit  as  by  handling  an  equal  amount  in 
smaller  lots  for  different  persons  at  a  higher  price. 

I  don't  know  that  the  special  contract  system  has  ever  been  put  in 
practice  by  any  carrier  in  its  local  business  in  California.  It  seems 
to  me  that  there  might  be  cases  where  a  special  contract — that  is,  not 
a  contract  which  shall  be  in  the  interest  of  an  individual,  or  a  com- 
munity, as  against  some  other  individual,  or  some  other  community, 
but  which  shall  be  "  special "  in  the  sense  that  it  shall  be  different 


180 

from  the  usual  and  ordinary  term  of  carriage  by  the  railroad  com- 
pany— would  be  necessary  in  order  to  enable  the  carrier  to  properly 
serve  the  public.  Our  State  is  young.  Our  agricultural,  horticul- 
tural, and  manufacturing  interests  have  still  great  room  for  growth 
and  development.  They  may  be,  in  large  sense,  dependent  upon 
facilities  for  transportation  for  their  success,  and  the  carrier  should 
not  be  forbidden  to  make  terms  and  conditions  essential  to  their  suc- 
cess, provided  such  terms  and  conditions  shall  be  equally  available 
to  all  the  public  under  similar  circumstances. 

With  respect  to  section  third  I  have  nothing  to  say. 

With  respect  to  section  four,  it  strikes  me  as  a  very  unwise  provi- 
sion. We  need  railroads.  We  should  be  in  the  attitude  of  welcome 
continually,  and  instead  of  making  laws  which  might  be  construed, 
whether  justly  or  not,  as  hostile  towards  such  enterprises,  we  should 
avoid  even  the  appearance  of  discouraging  them.  I  can  see  no  great 
good  end  to  be  served  by  enacting  that  section  into  a  law,  while  I 
can  see  that  it  might  be  the  means  of  preventing  the  extension  of 
railroads  now  touching  our  borders,  which  are  incorporated  under 
the  laws  of  other  Governments  or  States. 

With  respect  to  sections  five  and  six  my  advice  would  be  worth 
little  to  your  honorable  committee. 

With  respect  to  section  seven,  as  a  matter  of  opinion,  I  will  say 
that  it  seems  to  me  that  a  provision  that  will  forfeit  the  charter  of  a 
corporation  for  the  illegal  act  of  an  employe  or  an  agent,  which  may 
have  originated  in  malice  towards  the  corporation,  or  in  ignorance, 
or  carelessness,  is  unnecessarily  severe.  Laws  should  be  enforced. 
Corporations  as  well  as  individuals  should  be  made  to  respect  and 
obey  the  law,  but  a  needlessly  severe  penalty  more  often  works  to 
defeat  the  end  of  the  law  than  to  secure  it.  It  seems  to  me  that  this 
section  can  be  amended  so  as  to  secure  obedience  to  the  law,  and 
that,  too,  by  modifying  the  penalty  instead  of  enacting  it  as  it  now 
stands. 

I  have  no  criticism  to  offer  regarding  section  eight. 

I  should  have  been  pleased  to  meet  your  committee  and  to  have 
given  it  an  opportunity  to  question  me  as  to  my  views  relative  to  this 
bill  if  that  were  at  all  possible.  Regard  for  my  duty  as  a  citizen  has 
impelled  me  to  give  you,  hastily,  these  criticisms,  which  I  hope  will 
be  received  in  the  kindly  spirit  in  which  they  are  tendered. 

Yours  very  respectfully, 

W.  F.  WHITTIER. 


Statement  of  J.  B.  Wheeler. 

Mr.  Chairman  and  Gentlemen — Senators:  I  make  no  preten- 
sions to  oratory  or  elocution.  Like  one  of  our  notable  fellowmen — 
and  I  base  the  remark  upon  one  that  he  made — a  platform  is  calcu- 
lated, not  to  catch  flies,  but  to  catch  men.  But  were  I  not  to  make  a 
few  remarks  in  regard  to  what  brought  me  here  (and  I  presume  to 
say,  for  what  you  are  here),  I  should  be  recreant  to  my  duty  at  least. 
WTe  are  all  here,  I  presume,  for  a  purpose.     There  was  a  time  when  it 


181 

was  considered  that  you  were  called  here  in  the  interest  of  the  Gov- 
ernment established  by  our  sires  of  the  revolution  in  the  interests  of 
the  people;  but  there  is  a  great  issue  at  stake,  or  seems  to  be  now, 
between  the  Government  and  another  power  seeking  to  be  the  Gov- 
ernment. I  would  not  make  these  remarks  did  I  not  understand  the 
jeers  of  some  of  the  gentlemen.  There  was  a  time,  I  say,  when  we 
had  what  we  supposed  to  be  a  government  of  the  people;  a  purely 
cooperative  democratic  government — a  government  by  and  for  the 
people,  but  there  is  a  power  that  has  grown  up,  a  mighty  power  in 
our  land,  that  bids  defiance  to  that  government.  It  is  a  cooperative 
government,  too,  as  I  understand  by  cooperative  government,  to  be 
a  government  of  interests,  and  as  our  forefathers  intended  it  should 
be  a  government  of  cooperative  interests. 

[A  point  of  order  was  raised,  that  the  gentleman  should  address 
himself  to  the  subject.] 

All  right.  I  can't  very  well  speak  of  that  first ;  I  don't  know  how, 
unless  I  am  allowed  to  give  the  two  governments.  There  is  a  gov- 
ernment of  the  people;  a  cooperative  government. 

Senator  Brooks — I  would  like  to  ask  the  gentleman  if  he  has  any 
objection  to  giving  his  ideas  upon  this  bill?  Answer — In  a  very  few 
minutes  I  will  answer  your  questions.  I  want  to  say  to  you  that  our 
forefathers  intended  to  have  a  cooperative  government,  and  now  it  is 
a  cooperative  government  of  incorporations.  That  is  a  power  that 
is  making  itself  apparent  in  this  Government — the  cooperative 
interests  of  the  corporations. 

Senator  Kellogg — I  ask  that  the  gentleman  give  us  his  ideas  in 
regard  to  the  bill. 

[Senator  McClure  appointed  to  conduct  the  examination.] 

Q.  What  is  your  name?    A.  Wheeler. 

Q.  Where  do  you  reside?  A.  If  I  am  permitted  to  make  a  further 
statement — I  reside  at  Oakland. 

Q.  It  has  been  the  custom  of  this  committee  to  first  allow  a  gentle- 
man to  give  a  general  statement  with  regard  to  his  views  of  this  bill 
No.  10. '  You  will  now  have  an  opportunity  to  make  such  statement, 
and  then  I  will  ask  you  a  question  or  two  in  reference  to  it.  This 
is  a  question  of  discrimination  and  abuses  by  transportation  com- 
panies ?  A.  I  suppose  that  any  further  statement  of  mine  according 
to  my  ideas  is  shut  off  now? 

Q.  You  have  made  a  pretty  full  introductory  statement.  A.  It  is 
very  short  considering  the  cause  and  the  importance 

Q.  Well,  we  are  limited  now  in  time.  A.  Well  now,  I  would  like 
to  ask  you  a  question;  I  would  like  to  ask  why  this  change  of  pro- 
cedure ? 

Q.  There  is  no  change  of  procedure?  A.  I  have  been  before  this 
committee  for  the  last  week,  and  I  understand  how  it  has  been  con- 
ducted. 

Q.  You  will  proceed  and  state  your  views  with  reference  to  this 
bill,  laying  aside  for  the  present  these  questions  of  great  public  pol- 
icy?    A.  That  is  what  I  intended  to  speak  of. 

Q.  You  have  made  the  introductory  remarks?  A.  It  leaves  them 
in  a  very  bad  condition. 


182 

Q.  I  think  the  Senators  will  understand  your  position  ?  A.  Per- 
haps they  do. 

Q.  I  understand  that  the  platform  upon  which  you  stand  is  a 
cooperative  platform?  A.  Yes,  sir;  cooperative — a  platform  of  the 
interests  of  fifty  millions  of  people,  and  the  cooperative  interests  of  a 
few  corporations.  Now  in  order  to  prevent  "discrimination,"  it 
would  be  necessary  for  me  to  show  that  the  cost  of  carrying  freights 
and  fares — that  the  rate  per  mile — is  merely  nominal.  I  have  been 
before  this  committee  for  the  last  few  days,  and  I  have  heard  several 
of  the  railroad  magnates  upon  this  point.  Thejr  pretend  to  say  that 
it  is  impossible  for  them  to  carry  freights  and  fares  without  discrim- 
ination. 

Q.  Are  you  stating  the  conclusions  of  the  witnesses  ?  A.  I  pretend 
to  say  that  you  cannot  treat  the  case  correctly  without  making  a 
statement  of  what  freights  and  fares  shall  be,  leaving  to  them  a  decent 
respectable  profit  for  doing  the  business  ;  and  all  the  railroad  gen- 
tlemen which  I  heard  make  statements  before  this  committee,  have 
testified  that  it  was  impossible  for  them  to  do  business  unless  they 
were  allowed,  both  in  time,  place,  and  price,  and  persons. 

Q.  Are  you  speaking  of  accommodations  also  ?  A.  Yes,  sir.  In 
order  for  me  to  show  that  they  can,  it  is  necessary  for  me  first  to  show 
the  cost  of  actually  carrying  freights  and  fares  to  be  merely  nominal. 
It  amounts  to  simply  nothing.  I  will  give  you  a  statement  of  the 
cost  of  carrying  freights  and  fares,  and  prove  why. 

Q.  Have  you  the  statement  prepared?  A.  No,  sir;  not  in  full.  I 
have  stated  to  you  that  I  could  not  treat  the  subject  fairly  and  prop- 
erly. I  do  not  ask  you  to  take  my  figures  alone;  I  propose  to  show 
by  their  own  statements;  but  I  will  first  give  you  my  own  figures. 
They  say  I  am  a  maniac,  and  that  I  am  crazy;  when  I  take  their 
own  statements  to  prove  that  my  statements  are  correct,  you  will  no 
longer  have  cause  to  say  that  I  am  crazy.  I  propose  to  show  the  cost 
of  carrying  a  thousand  passengers  three  thousand  miles — the  cost  of 
taking  a  fifteen-car  train  to  New  York.  Some  might  say  it  would  be 
the  fuel,  but  I  will  leave  it  to  you  whether  it  will  be  the  fuel.  The 
cost  of  coal  for  a  fifteen-car  load  three  thousand  miles — coal  per  day 
three  tons,  cost  from  ninety  cents  to  two  dollars  per  ton;  that  is  what 
it  costs  Stanford  and  Crocker,  the  owners  of  these  rights,  across  the 
plains.  They  have  their  own  coal  beds — they  own  them — and  it  costs 
them  what  it  costs  them  to  get  the  coal  out  of  the  mine.  Any  person 
knows  the  cost  of  excavating  coal,  and  that  only  costs  from  forty-five 
to  ninety  cents  a  ton,  after  being  conveyed  on  this  same  railroad  for 
a  thousand  miles.  We  will  take  the  highest  rate,  always  giving  them 
the  advantage,  for  they  are  poor  gentlemen,  and  I  don't  wish  to  take 
advantage  of  the  poor.  Three  tons  at  two  dollars  per  ton  equals  six 
dollars  per  day;  for  a  six  days'  trip  equals  thirty-six  dollars  for  coal; 
and  that  would  be,  at  the  price  of  Towne's  statement,  one  hundred 
and  eight  dollars.  Towne  says  that  the  coal  costs  him  six  dollars 
per  ton  ;  two  brakemen,  at  two  dollars  and  twenty-five  cents  each, 
four  dollars  and  fifty  cents  per  day;  one  engineer,  four  dollars;  one 
conductor,  three  dollars  ;  the  amount  for  hands  on  the  train,  four- 
teen dollars  per  day,  six  days — six  times  fourteen  equals  eighty-four 


183 

dollars ;  cost  of  keeping  the  roadbed  in  repair  for  three'thousand 
miles  at  thirty  men  to  the  hundred  miles,  at  a  dollar  and  a  half  a 
day,  eight  thousand  one  hundred  dollars  to  keep  the  entire  line  in 
repair  for  six  days,  allowing  eight  trains  a  day  to  pass  over  said  road- 
bed per  day — four  trains  each  way.  By  dividing  the  cost,  eight  thou- 
sand three' hundred  dollars,  by  the  number  of  trains  passing  over  the 
road,  six  days,  you  have  one  hundred  and  seventy  dollars  to  the  one 
train.  The  cost  of  the  one  train  portion  of  the  keeping  the  roadbed 
in  repair  for  the  entire  route,  sum  total  up  to  date,  two  hundred  and 
ninety  dollars.  We  get  at  the  wear  and  tear  of  the  road  by  figuring 
the  life  of  a  car  at  thirty  years,  which  is  short.  I  will  guarantee  that 
a  car  can  be  kept  in  repair,  if  it  is  built  like  the  one-horse  shay  that 
we  all  heard  about  when  we  were  boys,  for  that  will  run  fifty  instead 
of  thirty  years.  By  figuring  the  life  of  a  car  at  thirty  years,  I  get  the 
first  cost  of  a  train  at  sixty  thousand  dollars,  and  the  cost  of  repairs 
of  a  train  at  sixty  thousand  dollars  more ;  sum  total,  one  hundred 
and  twenty  thousand  dollars.  The  total  number  of  trips  we  would 
make  in  thirty  days,  one  thousand  eight  hundred  and  twenty-five; 
the  cost  of  one  trip  would  be  as  many  times  as  one  thousand  eight 
hundred  and  twenty-five  is  contained  in  one  hundred  and  twenty  dol- 
lars, which  is  sixty-one  dollars,  for  the  cost  of  keeping  one  train  in 
repair  during  a  six  days'  trip. 

Q.  You  have  not  charged  anything  for  oil?  A.  I  have  not  got  to 
that  yet.  Oil  is  always  an  after  consideration.  Oil  (putting  his  hand 
behind)  sometimes  is  a  previous  consideration.  We  will  add  the  oil 
and  find  the  general  cost.  It  would  take  about  five  dollars'  worth  of 
oil  to  run  a  train  to  New  York  City,  but  we  will  put  it  at  seven  dol- 
lars and  fifty  cents.  We  don't  wish  to  take  any  advantage  of  the 
poor.  For  Superintendent's  and  incidental  expenses,  say,  on  an 
average,  that  it  costs  five  hundred  thousand  dollars  per  annum,  all  told, 
and  no  more.  That  is  to  be  divided  by  the  entire  business — and 
there  is  something  like  two  thousand  five  hundred  to  three  thousand 
trains  pass  across  the  continent  every  year,  besides  the  other  home 
business  in  the  State.  That  would  not  make  over  ten  dollars  a  train 
for  these  incidental  expenses. 

Q.  I  would  suggest  that  you  give  us  the  results  of  your  figures? 
A.  The  conclusion  is  that  it  is  ten  dollars.  I  have  not  the  figures 
here,  but  I  figured  it  out  before  I  came  here.  Now,  the  sum  total  of 
taking  that  train  to  New  York  is  three  hundred  and  ninety  dollars. 
Divide  that  by  the  number  of  persons;  fifteen  cars  will  seat  one 
thousand  and  five  passengers — I  mean  in  the  emigrant  cars.  I  am 
speaking  of  common  people,  and  not  of  sixty  thousand  dollar  cars. 

Sbnatoe  Brooks — I  want  to  ask  a  question?  A.  I  would  like  to 
finish  the  statement. 

<,>.  Do  you  know,  of  your  own  knowledge,  any  discrimination  that 
has  been  practiced  by  the  railroad  company  in  this  State;  if  you  do, 
the  committee  will  hear  you  on  those  matters  of  facts?  A.  I  have 
seen  some  facts  of  discrimination.     I  know  of  some. 

[Senator  Spencer  appointed  to  finish  the  examination.] 

Me.  Wheeler — Am  I  permitted  to  go  on  and  finish? 

Senator  Spencer — Is  it  material  to  you  whether  you  go  home  now 


184 

or  in  the  morning?  A.  I  will  answer  the  question.  As  long  as  you 
will  hear  the  truth  from  me  I  will  stay  with  you. 

Q.  I  was  about  to  outline  an  examination,  and  I  did  not  know  but 
you  were  in  a  hurry  to  get  home.  Do  you  know  anything  about 
the  transportation  of  goods  in  its  order?  A.  Well,  I  made  a  propo- 
sition, as  I  understand,  to  answer  your  question.  ' 

Q.  Have  you  any  objection  to  section  one  of  this  bill?  A.  I  have 
it  here.     I  will  read  it  to  you. 

Q.  Goon.  A.  (Reading) — This  is  a  cooperative;  that  is  corpora- 
tion— no  cooperation.     Going  by  rail,  are  you,  or  by  telegraph? 

Q.  I  suppose  you  have  read  this  bill.  Shall  I  read  it  to  you 
(reading  the  bill  quite  rapidly)?    A.  You  needn't  read  it  in  that  style. 

Q.  Have  you  any  objection  to  section  one  of  it?  A.  Provided  it  is 
built  on  the  cooperative  plan  and  operated  under  the  cooperative 
system. 

Q.  Do  you  see  any  objection  to  section  two?  A.  I  will  have  to  see 
and  read  it  myself.  You  are  not  a  good  reader.  It  is  strange  that 
you  American  people  that  are  sent  here  cannot  read  well.  If  you 
ask  me  questions  properly  I  will  answer  if  I  am  permitted  to  go 
ahead  and  make  my  statement. 

Q.  I  simply  want  to  ask  if  you  have  any  objection  to  section  two? 
A.  This  is  a  farce  that  has  been  perpetrated  here  against  me.  If  you 
think  I  am  not  capable  of  seeing  these  things,  you  are  very  much 
mistaken. 

Q.  Have  you  read  this  bill?    A.  I  have,  sir. 

Q.  Have  you  any  objections?     A.  If  it  is  your  intention 

Senator  Taylor — I  object  to  the  witness  scolding  and  intimidat- 
ing the  Senator. 

Senator  Spencer — Have  you  read  the  bill  ?    A.  Yes,  sir. 

Q.  Do  you  see  any  objection  to  this  bill?    A.  Yes,  sir. 

Q.  What  are  your  objections  to  it?  A.  If  you  will  allow  me  to  go 
on,  and  in  my  regular  way,  I  will  come  to  it  and  point  them  out. 

Q.  I  only  desire  to  call  your  attention  to  the  bill  under  considera- 
tion? A.  In  the  first  place,  a  portion  of  it  does  not  allow  discrimi- 
nation. 

Q.  Have  you  read  section  two  of  this  bill?    A.  I  have  read  it  all. 

Q.  Is  there  any  objection  to  section  two?  A.  If  this  is  the  line  of 
questioning  that  you  are  going  to  present  I  will  read  it  very  carefully 
again,  as  I  intended.  I  was  here,  and  saw  your  proceedings  for  the 
last  four  or  five  days,  and  in  spite  of  the  best  evidence  that  the  rail- 
road can  produce,  by  the  magnates  of  the  railroad  company — and 
this  is  a  matter  of  discrimination,  I  propose  to  show. 

Q.  Well,  I  will  thank  you  on  behalf  of  the  committee,  and  we  will 
now  adjourn.     A.  Just  wait  a  minute. 

Senator  Brooks — You  have  been  engaged  in  politics  for  some 
time?     A.  What  has  that  to  do  with  discrimination? 

Senator  Kellogg — I  understand  that  you  have  given  this  subject 
a  good  deal  of  time  and  attention  ?  A.  I  have,  I  think,  more  than 
any  other  man. 

Q.  You  have  put  nearly  all  your  time  in  upon  it?    A.  Yes,  sir. 

Q.  You  have  done  nothing  else  during  the  last  seven  years.    Have 


185 

you  ever  shipped  or  received  a  ton  of  goods  over  these  roads?  A.  I 
don't  know  what  that  would  have  to  do  with  the  cost. 

Q.  But  your  study  has  been  a  benefit  to  the  people?    A.  Yes,  sir. 

Q.  You  were  at  one  time  a  candidate  for  Governor?  A.  That 
don't  make  any  difference. 

Q.  Do  you  agree  with  the  statements  made  here  that  there  ought 
to  be  no  discrimination  as  to  rates  per  ton  per  mile?  A.  I  do  ;  there 
should  be  no  discrimination. 

Q.  Do  you  say  that  the  rates  ought  to  be  the  same  on  long  hauls  as 
on  short  hauls?    A.  I  do  not. 

Q.  Explain  your  views  on  that  proposition?  A.  There  ought  to 
be  no  discrimination  in  persons — in  proportion  to  the  distance. 

Q.  Then,  you  are  in  favor  of  discrimination  thus  far?  A.  Yes, 
sir;  it  should  be  a  fixed  thing.  I  could  not  answer  that  without 
bringing  in  this  cooperative  government,  if  we  were  trying  to  arrive 
at  justice  at  all.  If  a  man  lived  less  than  two  hundred  miles  away, 
his  freight  should  not  be  more  than  two  cents  per  ton  per  mile. 

Q.  Have  you  a  schedule  of  the  rates  which  ought  to  be  charged? 
A.  Yes,  sir. 

Q.  Read  it?  A.  We  are  figuring  on  a  basis  purely  cooperative ;  a 
purely  cooperative  democratic  government,  by  and  for  the  people,  to 
do  the  greatest  good  to  the  greatest  number.  The  first  one  hundred 
miles,  two  and  a  half  cents  a  mile;  call  it  three  and  a  half;  twelve 
tons  to  the  car,  forty-two  cents  per  ton  to  the  car;  fifty  cars  on  one 
train;  forty-two  times  fifty  is  two  thousand  one  hundred  dollars  for 
taking  a  train  one  hundred  miles.  The  first  two  hundred  miles,  one 
and  three  fourth  cents  per  ton  per  mile;  the  first  three  hundred 
miles,  one  sixth  of  a  cent  per  ton  per  mile;  four  hundred  miles, 
seven  eighths  of  a  cent;  six  hundred  miles,  seven  tenths  of  a  cent. 

Q.  Do  you  make  it  anywhere  on  your  schedule  that  the  distance  is 
so  far  that  they  can  haul  for  nothing?  A.  No,  sir;  it  never  goes 
down  to  that.     A  half  cent  is  as  low  as  it  goes. 

Q.  Do  you  think  that  there  ought  to  be  discrimination  made  in 
prices  or  classes ?  A.  Different  classes  should  be;  yes,  sir.  It  would 
be  impossible  to  carry  some  goods  by  the  ton. 

Q.  Do  you  think  that  a  cargo  of  wheat  ought  to  be  shipped  at  the 
same  price  as  a  cargo  of  tea  ?     A.  No. 

Q.  How  about  live  stock  as  to  discrimination  in  shipping?  A.  I 
think  live  stock  is  perishable;  it  is  possible  for  them  to  eat  themselves 
up  paying  expenses.     That  is 

Q.  Would  they  perish?     A.  The  man  might  perish. 

Q.  Is  there  any  other  facts  that  you  desire  to  bring  before  this 
committee  ?  A.  All  that  1  ask  to  state  further  is  just  this,  I  wanted 
to  show  you  that  the  men  who  testified  here 

Q.  That  would  be  the  business  of  the  committee?  A.  My  state- 
ment here  is,  that  you  should  go  a  thousand  miles  for  four  bits  a  ton. 
I  want  to  corroborate  that. 

The  Chairman — Do  you  desire  to  make  any  correction  to  what 
you  have  stated?  A.  I  want  to  ask  that  the  railroad  deal  fairly  by 
the  people  who  have  built  the  road.  The  measures  they  adopt  to 
carry  their  principles  are  such  as  should  not  be  used  by  a  railroad 


186 

representing  a  capital  of  seven  millions  of  dollars.  We  find  that 
they  can  protect  themselves  against  legislation,  and  against  the  con- 
trol of  the  Government.  These  are  the  big  points  of  this  subject, 
irrespective  of  the  mere  matter  of  money,  which  I  conceive  is  of 
small  moment  compared  to  the  degradation  of  the  country,  which 
we  all  admit.  Therefore  it  must  be  controlled,  and  I  understand  that 
is  what  you  are  here  to  do.  Your  duty  is  found  in  an  article  in  the 
Constitution  upon  corporations;  that  the  Legislature  shall  pass  all 
laws  necessary  for  the  enforcement  of  the  article.  You  wish  to  take 
up  this  subject,  and  pass  such  laws  as  are  required  to  control  these 
matters,  and  the  receipts  of  the  railroad  company,  over  which  you 
have  reasonable  control.     The  difficulties  are  twofold. 


Statement  of  General  Naglee. 

Gentlemen:  I  appear  before  you  in  answer  to  your  request.  I 
would  like  to  state  in  regard  to  these  railroad  matters,  that  I  like  to 
look  at  a  locomotive  of  a  thousand  tons  passing  over  the  country  at 
a  rate  that  only  a  bird  can  fly.  It  seems  a  most  extraordinary  thing, 
that  we  should  have  such  facilities  of  transportation.  In  the  olden 
times  any  one  could  put  his  boat  upon  the  waters ;  anybody  could 
build  his  boat;  anybody  could  carry  transports,  and  the  result  was, 
that  there  was  no  such  complaint,  and  there  ought  to  be  no  com- 
plaint in  the  matter  of  mere  railroad  transportation,  and  there  ought 
to  be  no  difficulty.  I  look  upon  difficulties  encountered  in  this  sub- 
ject as  coming  from  the  fact  that  railroads  go  out  of  their  sphere 
altogether  and  interfere  with  the  polities  of  the  country.  They 
should  not  interfere  with  politics,  but  should  let  the  parties  alone. 
Another  thing  in  that  matter  of  politics,  we  find  that  the  one  in 
relation  to  this  matter  of  discrimination,  and  the  other  in  relation 
to  over-charges.  These  are  the  most  important  of  all  outside  of  the 
interference  of  politics. 

They  are  entitled  to  a  certain  consideration,  and  a  limited  consid- 
eration. As  far  as  the  railroad  is  concerned,  it  is  the  law  of  the  land, 
and  they  should  be  entitled,  first,  to  their  expenses  legitimately,  hon- 
estly, and  economically  made;  and  they  are  only  entitled  to  a  fair 
consideration  for  their  investment.  Now,  it  is  a  big  point  to  deter- 
mine how  much  they  shall  have.  I  don't  think  there  is  any  diffi- 
culty in  that,  for  the  simple  reason  that  we  have  the  reports  of 
experts  as  to  what  has  been  received,  showing  that  they  have  charged 
unfairly,  and  three  or  four  times  as  much  as' they  should.  The 
reports  of  Mr.  Towne  show  that  the  expenses  of  these  roads  is  about 
eleven  or  twelve  millions  of  dollars.  That  they  are  entitled  too. 
Now,  if  eleven  millions  of  dollars  is  a  reasonable  expense  of  the  road, 
I  will  allow  two  millions  more,  and  a  million  for  contingencies,  say 
fifteen  million  dollars,  and  no  more.  Now,  they  are  receiving  twenty- 
five  millions;  they  are  not  entitled  to  it  under  the  decision  of  the 
Courts,  but  only  to  a  reasonable  consideration.  This  ten  million 
dollars  over  and  above  what  they  should  receive,  should  be  left  with 


187 

the  people  of  the  country.  There  should  be  means  taken  by  which 
it  should  be  done — by  which  the  facts  should  be  ascertained — and 
then  the  power  should  be  prevented  from  charging  heavy  freights, 
dragging  out  money  to  which  they  are  not  entitled.  They  break 
down  manufactures.  We  should  encourage  manufactures.  With 
our  new  State,  we  should  do  a  great  deal  of  manufacturing  at  home. 
These  things  are  done  in  the  most  extraordinary  way,  and  the  meth- 
ods taken  to  prevent  interference  are  most  ingenious. 

One  illustration  is  the  paper  business.  We  were  being  successful  in 
the  manufacture  of  paper,  and  there  were  incentives  for  the  estab- 
lishment of  a  large  number  of  paper  mills,  and  we  were  making 
it  successful.  The  railroad  company  said,  "You  shall  not  do  it, 
because  we  want  to  bring  all  the  paper  over  the  continent.  We  will 
introduce  the  paper  so  low  that  it  will  be  worth  almost  nothing,  and 
will  put  a  double  price  on  wood  pulp,  and  increase  the  cost  by  which 
paper  can  be  made,  and  we  will  put  the  price  of  transportation  so 
low  that  they  can  afford  to  send  all  the  rags  east."  Now,  in  regard 
to  the  farmer:  They  had  to  pay  so  much  for  carrying  wheat  that 
they  could  not  afford  to  send  it  to  New  York,  and  so  much  for  carry- 
ing flour  that  they  could  not  afford  to  send  the  flour.  The  matter  of 
raising  wheat  has  become  material ;  we  will  raise  fifty  million 
bushels  this  year.  We  know  that  ships  are  coming  here,  and  that 
this  wheat  can  be  shipped  around  the  Horn  at  from  two  pounds  to 
two  pounds  and  a  half;  but  the  railroad  company,  by  their  special 
contract  system,  are  preventing  the  ships  from  bringing  freights  to 
this  coast.  They  should  be  prevented  from  any  such  interference. 
The  ship  must  have  double  freight  to  take  it  back  if  they  have  to 
come  here  empty.  Thus  they  break  down  the  raising  of  wheat. 
There  ought  to  be  one  million  of  tens  surplus  this  year,  which,  at 
a  loss  to  the  farmer  of  five  to  ten  dollars  per  ton,  would  make  a  loss 
in  the  aggregate  to  our  farmers  of  from  five  to  ten  millions  of  dol- 
lars. My  share  of  the  crops  this  year  in  San  Joaquin  County  will  be 
fifteen  hundred  to  two  thousand  tons.  At  the  above  figures  it  will 
make  to  me  a  loss  on  this  crop  of  from  seven  thousand  five  hundred 
to  fifteen  thousand  dollars.  Another  large  interest  of  this  State  is 
that  of  fruits.  Fruits  ripen  here  much  earlier  than  they  do  in  the  East, 
and  if  the  shipper  could  get  them  into  the  markets  there  they  could 
get  the  best  prices  for  them;  and  with  any  reasonable  prices  for 
freights,  we  could  have  our  whole  country  raising  fruit.  Instead  of 
charging  eight  hundred  dollars  for  a  carload  of  fruit,  it  should  be 
brought  down  to  a  reasonable  figure — something  like  two  or  three 
hundred  dollars.  The  result  would  be,  that  everybody  would  be 
encouraged  in  fruit  raising,  and  instead  of  sending  carloads,  as 
we  now  do,  we  would  have  trains  of  cars  loaded  with  fruit  cross- 
ing the  continent.  I  was  in  business  in  San  Francisco,  and  had 
worked  there  for  a  long  time,  and  wanted  to  retire.  I  had  made  a 
sum  of  money  that  I  thought  was  sufficient  for  me,  and  it  was  sug- 
gested that  I  should  go  into  the  grape  business.  People  from  the  old 
country  told  me,  "This  is  the  best  country  in  the  world  for  raising- 
grapes."  The  people  of  France  and  Germany,  and  Hungary  and  of 
Italy,  and  all  other  wine  countries,  brought  their  vines  and  planted 


188 

them  here,  and  the  result  is,  that  a  cluster  of  our  grapes  is  four 
times  as  large  as  when  grown  in  Europe,  with  superior  qualities. 
These  gentlemen  said:  "  Here  is  the  place  to  make  wine  and  brandy, 
and  you  can  develop  a  fine  industry."  They  said:  "General  Naglee, 
have  you  any  idea  of  the  extent  of  the  wine  country  of  France?  "  "  No ; 
tell  me  about  it."  "Why,  they  produce  twenty-two  hundred  millions  of 
gallons,"  which,  at  twenty  cents  per  gallon,  produces  four  hundred  and 
fifty  millions  of  dollars  per  year — three  times  as  much  as  the  entire 
cotton  crop  of  the  United  States.  The  wine  crop  of  France  paid  the 
enormous  penalties  placed  upon  France  by  Prussia  in  two  years.  This 
greatindustry  seems  not  to  be  appreciated  by  the  railroad  company,  for 
without  a  special  contract,  the  freight  charge  is  six  cents  per  pound, 
or  forty-five  cents  per  gallon,  making  no  allowance  for  tare,  which  is 
fully  in  weight  equal  to  that  of  the  wine,  thus  doubling  the  regular 
rate,  and  making  an  absolute  prohibition.  If  allowed  to  use  the 
ocean,  the  freight  would  be  at  the  rate  of  six  tenths  of  a  cent  per 
pound  to  New  York — about  one  tenth  of  that  charged  by  rail.  The 
excuse  made  for  the  above  excessive  charge,  was  because  of  the  lia- 
bility of  leakage  and  breakage.  The  simple  manner  of  disposing  of 
this  question  of  risk  and  insurance,  is  to  ascertain  from  the  books  of 
the  railroad  company  the  actual  amount  paid  for  loss  in  an  entire 
year,  divide  it  by  the  gross  receipts  of  the  year,  and  add  the  fraction 
to  the  freight,  which  would  dispose  of  the  question  of  loss  and  risk 
for  all  the  future.  Now  there  should  be  a  limit  to  the  amount  of 
charges  that  they  are  allowed  to  make.  If  there  is  not,  if  they  can 
charge  fifty  millions  they  can  charge  one  hundred  millions.  They 
should  be  limited,  and  they  are  entitled,  as  I  said,  to  a  limited 
consideration;  and  I  think,  that  under  their  showing,  about  thir- 
teen millions  would  be  reasonable.  You  should  say,  "  We  will  allow 
you  so  much  money ;  you  shall  do  as  you  ought  to  do ;  you  shall 
bring  your  classification  down  to  a  half  dozen  classes ;  say  dry  goods  so 
much,  hardware  and  agricultural  implements,  so  much." 

Senator  Cross — We  were  in  hopes  that  some  of  that  good  brandy 
would  come  this  way?  A.  You  shall  not  be  disappointed.  It  seems 
to  me  that  we  should  fix  the  amount  that  they  shall  have,  and  then 
make  reductions  in  favor  of  the  people  of  everything  beyond  that. 
Now,  these  special  contracts  are  all  wrong,  and  they  should  be  stopped. 
They  have  more  complications  than  in  the  tariff  of  the  Government  of 
the  United  States.  What  did  they  do  in  times  of  old  with  ships?  A 
ship  was  to  sail  for  San  Francisco,  and  everything  that  comes  along 
was  taken  at  the  same  figure.  It  didn't  make  any  difference;  stone, 
wheat,  or  anything  else;  they  didn't  stand  upon  the  order  of  taking 
freight,  but  took  all  that  was  offered,  and  found  a  place  to  put  it  on 
board  ships  of  three  or  four  decks — a  great  deal  more  difficult  matter 
than  to  put  it  in  a  box-car — and  there  were  no  questions  about  a  half 
or  a  whole  ton.  The  heavy  material  must  go  to  the  bottom  of  a  ship, 
and  the  lighter  to  the  top,  but  there  was  no  trouble.  What  does  it 
cost  to  load  a  car?  Why,  seven  men  can  load  a  car  in  a  half  an 
hour,  which  at  one  dollar  and  fifty  cents  per  day  would  be  just  fifty 
cents  for  loading  the  car.  Now,  where  is  there  any  sense  in  this  mat- 
ter of  a  car,  or  a  half  a  car,  or  in  an  extra  charge  for  loading  and  un- 


189 

loading  ?  Now,  there  is  another  point  in  the  Barry  bill.  Why  not 
just  simply  make  provision  for  a  half  a  dozen  classes,  and  everybody 
can  comprehend  it  in  that  way?  Another  thing  is  the  matter  of 
fares.  In  New  York  State,  they  are  two  cents  a  mile.  Here  they 
doable  it  up,  and  then  double  it  up  again.  Our  relations  with  the 
railroad  allows  us  to  demand  of  them  reasonable  charges,  and  there 
are  decisions  which  say  that  you  shall  not  charge  one  man  one  price 
and  another  a  different  one.  A.  few  days  afterwards  I  sent  to  San 
Jose  for  a  carload  of  slabs  for  fuel.  I  was  charged  twenty-two  dol- 
lars the  carload  to  Bethany,  one  hundred  and  twenty-three  miles. 
The  car,  by  my  direction,  was  taken  to  Tracy,  from  Bethany,  seven 
miles,  and  the  charge  was  eleven  dollars.  A  gentleman  told  me  that 
he  sent  two  two-year  old  stallions  to  Arizona.  Said  he,  "  When  I 
asked  for  my  freight  bill,  I  found  that  I  was  charged  at  the  rate  of 
four  thousand  pounds  each."  He  supposed  there  must  be  some  mis- 
take, but  the  agent  showed  his  printed  regulations  from  Fourth  and 
Townsend  Streets,  and  that  he  was  allowed  no  discretion  in  the 
premises,  and,  although  the  stallions  weighed  but  eight  hundred 
pounds  each,  he  was  compelled  to  pay  on  eight  thousand.  Another 
friend  of  mine  had  been  sending  sheep  to  New  Mexico,  and  the  rate 
had  been  invariably  at  one  hundred  and  sixty  dollars  per  carload. 
He  wanted  to  send  a  car  of  Merino  sheep  to  New  Mexico,  of  superior 
quality,  and  applied  to  the  railroad  company  for  terms.  They 
requested  him  to  return  in  three  or  four  days.  The  railroad  com- 
pany telegraphed  to  New  Mexico  and  found  that  there  was  a  demand 
at  a  good  price  for  the  Merino  sheep,  and  charged  him  five  hundred 
and  sixty  dollars  for  the  carload.  Two  gentlemen  of  my  acquaint- 
ance wanted  a  special  contract  to  ship,  one  tin,  and  the  other  wheel- 
wright material,  from  New  York.  The  answer  of  the  railroad  company 
was,  "Send  a  list  of  the  persons  with  whom  you  deal  in  San  Fran- 
cisco." The  names  were  found  on  the  black  list  at  Fourth  and 
Townsend  Streets,  and  any  contract  was  refused.  A  firm  with  whom 
I  am  dealing  in  San  Jose,  applied  for  transfer  by  freight  of  goods  from 
San  Francisco.  The  answer  was,  "You  have  patronized  the  narrow 
guage  railroad,"  and  his  application  was  refused.  Still  another  gen- 
tleman of  my  aquaintance,  engaged  as  the  agent  of  an  agricutural  im- 
plement manufactory  in  or  near  Chicago,  had  a  special  contract.  He 
found  after  his  arrival  here  that  the  terms  were  greater  than  he  would 
pay  to  send  his  goods  to  New  York,  and  thence  by  Cape  Horn,  twenty- 
five  thousand  miles,  to  San  Francisco.  He  complained  to  his  friends 
of  the  outrageously  unreasonable  charges.  The  railroad  detectives 
reported  him  at  Fourth  and  Townsend  Streets,  and  his  contract  was 
shut  off  on  the  ground  that  he  talked  too  much.  A  friend  shipped 
some  mules  from  Livermore  to  Visalia,  and  the  carload  was  charged 
at  sixty-nine  dollars.  A  few  days  afterwards  he  sent  a  carload  of  bar- 
ley to  feed  the  mules,  and  the  charge  was  two  hundred  and  twenty- 
seven  dollars.  A  friend  living  in  Stockton  shipped  fruit  to  the  East. 
This  brought  him  in  contact  with  others  shipping  fruit  from  the 
Sacramento  Valley,  who  were  favored  by  the  railroad  company,  and 
his  venture  failed,  he  losing  four  thousand  dollars.  Lately,  in  San 
Jose,  the  San  Jose  Times  made  itself  obnoxious  to  the  railroad  com- 


190 

pany  by  exposing  their  outrageous  practices.  The  railroad  company 
determined  to  suppress  the  paper,  and  it  so  resulted  by  combin- 
ing with  a  ring  under  the  control  of  the  Board  of  Education,  who 
required  the  teachers  to  subscribe  one  hundred  dollars  apiece,  under 
threat  of  losing  their  positions,  to  purchase  the  paper.  The  pur- 
chase was  effected. 

Senator  McClure — I  understand  that  you  think  we  should  first 
ascertain  generally  the  cost  of  building  and  constructing  the  road, 
then  the  expenses,  and  then  allow  them  a  reasonable  compen- 
sation for  the  use  of  their  money,  and  that  they  should  be  limited  to 
that  as  a  compensation ;  and  that  a  bill  fixing  freights  and  fares 
should  be  passed;  and  that  a  maximum  rate  should  be  fixed,  and 
that  all  beyond  that  should  be  used  to  cheapen  and  regulate  matters 
naturally?  A.  I  should  allow  the  railroad  company  the  actual 
expenses  honestly  and  economically  made  in  running  the  road.  I 
should  allow  them  two  millions  of  dollars  for  the  use  of  their  capi- 
tal invested,  this  to  include  all  personal  service.  To  these  I  should 
allow  them  to  hold  back  one  million  five  hundred  thousand  dollars 
to  meet  extraordinary  contingencies,  but  the  balance  unexpended 
should  be  carried  forward  to  the  next  year,  and  all  of  the  remainder 
should  be  paid  into  the  State  Treasury.  I  should  require  the  rail- 
road company  to  make  sworn  monthly  statements  to  the  Controller, 
who  should  be  required  to  examine  the  books  and  vouchers  of  the 
railroad  company  and  verify  their  reports. 

Q.  Your  proposition  is,  that  they  are  making  too  much  money? 
A.  Yes,  sir. 

Q.  You  think  that  they  are  entitled  to  a  reasonable  compensation 
for  the  money  invested?     A.  Yes,  sir. 

Q.  Your  idea  is  that  there  should  be  a  maximum  rate?  A.  You 
have  Railroad  Commissioners  who  should  attend  to  that  matter,  in 
the  interest  of  the  people.  When  you  go  into  the  experience  of  this 
State  and  of  New  York,  and  other  States,  and  examine  the  matter, 
you  will  find  that  our  railroad  companies  are  overcharging,  and 
charge  three  times  as  much  as  they  should.  The  average  of  all 
freights  in  New  York  State  is  only  seventy-six  one  hundredths  of 
a  cent,  while  the  average  in  this  State  is  two  and  one  fourth.  By  the 
statistical  returns  made  at  Washington  for  the  year  ending  June  30, 
1883,  the  rate  for  the  transportation  of  grain  from  all  the  Western 
States  to  the  Atlantic,  was  but  twenty-seven  one  hundredths  of  a 
cent — a  little  over  one  quarter  of  a  cent.  In  all  moneyed  trans- 
actions there  are  a  payer  and  payee,  and  both  should  be  equally 
represented.  In  transactions  with  the  railroad  company  the  Rail- 
road Commissioners  were  intended  to  represent  the  payer  and  guard 
their  interests,  which  they  have  failed  to  do;  but  allow  the  payee  to 
charge  and  collect  at  his  pleasure,  with  no  protest  against  any  extor- 
tions, overcharges,  discriminations,  special  contracts,  or  rebates. 

Q.  These  are  matters  which  you  have  investigated,  which  lead  you 
to  the  conclusion  that  there  should  be  a  bill  providing  for  a  maxi- 
mum rate  of  freights  and  fares.  Were  these  facts  the  result  of  your 
own  personal  research?  A.  In  regard  to  the  subject  of  a  maximum 
I  have  fixed  three  cents  per  mile  as  that  of  fares,  and  two  cents  as 


191 

the  maximum  of  freights  per  ton  per  mile.  Taking  then  the  figures 
furnished  by  Mr.  Stanford  in  his  open  letter  published  in  the  Argo- 
naut, which  were  five  hundred  and  fifty  millions  of  tons  of  freight 
carried  one  mile,  and  one  hundred  and  eighty  millions  of  passengers 
carried  one  mile,  and  apply  the  above  figures,  the  result  will  be  as 
follows : 

550,000,000  tons  at  two  cents $11,000,000 

180,000,000  passengers  at  three  cents 5,400,000 


$16,400,000 


In  connection  with  the  above  I  have  asserted  that  the  expenses  of 
the  Central  Pacific  were  for  the  year  eleven  millions  of  dollars.  I 
would  then  allow  two  millions  five  hundred  thousand  dollars  to  the 
company  to  compensate  them  for  the  use  of  their  capital,  including 
their  personal  services.  I  would  add  one  million  and  a  half  to  pro- 
vide for  extraordinary  contingencies,  which  would  in  all  amount  to 
fifteen  millions  of  dollars;  the  balance  between  this  and  the  gross 
receipts  should  be  paid  into  the  State  Treasury;  and  the  rates  of 
freight  and  fares  for  the  following  year  should  be  reduced  that  no 
surplus  above  the  allowances  made  to  the  company  could  longer 
accrue.  The  gross  receipts  of  the  company  for  the  last  year  were 
twenty-five  millions  of  dollars;  all  of  which,  above  fifteen  millions, 
should  either  remain  with  the  people  or  be  paid  into  the  State 
Treasury. 

Senator  Taylor — Have  you  read  the  provisions  of  section  one  of 
the  Barry  bill  ?     A.  Yes,  sir. 

Q.  Do  you  think  the  provisions  of  that  section  are  in  the  interest 
of  the  shipper?  A.  I  make  no  objection  to  the  bill ;  I  think  it  would 
meet  the  requirements  intended. 

Q.  You  make  no  objection  to  the  bill  as  a  whole?  A.  I  don't 
object  to  that  section.  It  is  merely  a  repetition,  to  some  extent,  of 
section  two,  of  article  twelve,  requiring  the  Legislature  to  make 
penalties. 

Senator  Del  Valle — It  is  claimed  by  some  of  the  opponents  of 
this  bill  that  if  it  be  adopted,  it  will  have  the  effect  of  driving  cap- 
ital out  of  the  State,  and  prevent  competition  in  railroads?  A.  I 
don't  see  that  it  can  affect  capital.  I  see  no  difficulty;  anybody  can 
get  a  charter. 

Q.  Do  you  know  anything  about  the  special  contract  system  ?  A. 
The  company  fixes  certain  arbitrary  rates,  two  or  three  times  a  rea- 
sonable one,  which  is  called  an  open  rate,  and  which  is  charged  and 
collected,  unless  you  enter  into  a  special  contract,  and  by  which  you 
are  required  to  release  the  company  from  certain  risks  that  they 
incur  as  common  carriers.  The  special  rates  thus  obtained  are 
largely  beyond  those  prescribed  for  the  same  service  on  other  roads. 
I  object  to  the  special  contract  system,  inasmuch  as  it  tends  to  drive 
off  ships.  Then  they  pay  $100,000  a  month  to  the  Panama  steam- 
ship company  as  a  subsidy  for  not  competing  with  them.  It  works  a 
great  wrong.  They  can,  under  it,  make  or  break  individuals  or 
places.  You  are  well  aware  that  Huntington,  Hopkins  &  Company 
have  been  doing  about  one  half  of  the  entire  hardware  business  of 


192 

the  State.  Why  ?  Because  they  have  better  rates.  I  warrant  you 
they  don't  pay  as  much  as  anybody  else,  or  not  any  more,  if  any 
thing  at  all.  Through  the  means  of  these  contracts,  favoritism  can 
be  extended  and  a  community  be  increased  or  broken  down.  They 
can  break  anybody  down.  If  the}'  want  to  favor  a  man  in  Arizona 
in  business,  they  can  allow  him  to  sell  goods  cheaper  than  anybody 
else.      It  ought  not  to  be  permitted. 

Senator  McClure — That  is,  the  whole  system;  that  is,  not  con- 
fined to  this  State?  A.  I  have  one  of  the  special  contracts.  I  do  not 
care  to  have  it  go  out  of  my  possession,  or  that  the  names  should  be 
made  public.  The  names  must  not  be  read.  The  Clerk  may  read 
all  except  the  names: 

Contract  between,  the  Union  Pacific  Railroad  Company,  the  Atchison,  Topeka,  and  Santa  Fe  Bail- 
road  Company,  and  the  Missouri  Pacific  Railway  Company,  and  others. 


Tin's  agreement,  made  and  entered   into  this ■  day  of ,  A.  D.  one  thousand 

eight  hundred  and  eighty,  by  and  between  the  Union  Pacific  Railroad  Company;  the  Atchison, 
Topeka,  and  Santa  Fe  Railroad  Company;  and  the  Missouri  Pacific  Railway  Company,  for 
itself;  and  the  St.  Louis,  Iron  Mountain,  and  Southern  Railway  Company ;  the  International 
and  Great  Northern  Railroad  Company,  and  the  Texas  and  Pacific  Railway  Company,  first 
parties,  and  the  firm  of ,  of  the  City  of  ,  second  party.  Witnesseth  :  That  in  con- 
sideration of  the  agreement  made  by  the  second  party  as  hereinafter  described,  to  be  by  said 
second  party  fully  performed,  maintained,  and  fulfilled,  said  first  parties  have  covenanted  and 
agreed,  and  do  hereby  covenant  and  agree  that  upon  all  the  goods,  wares,  and  merchandise 
shipped  from  the  eastern  points  hereinafter  -named,  all  or  any  of  them,  and  consigned  to  said 

second  party  at ,  during  the  term  of  this  contract,  the  freight  charges  shall  not  exceed 

the  following  rates,  in  United  States  currency,  per  one  hundred  pounds,  gross  weight,  namely  : 


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Upon  freight  not  herein  specially  provided  for,  the  rates  shall  not  exceed  those  provided  by 
the  freight  tariff  published  by  the  first  parties,  which  may  be  in  effect  between  the  cities 
named  at  the  time  such  freight  is  shipped: 

Freight  from  the  points  hereinafter  named  shall  be  transported  as  follows,  i.  e. :  At  New 
York  rates — From  Boston,  Philadelphia,  Baltimore,  Richmond,  Petersburg,  Lynchburg.  Gor- 
donsville*  Charlottesville,  and  Staunton,  Va.;  Charleston,  W.  Va.;  New  Orleans,  La. ;  Ilarris- 
burg,  Pa. ;  Newark  and  Trenton,  N.  J.;  Albany,  Troy,  and  all  stations  on  the  Hudson  River 
Division  of  the  N.  Y.  C.  &  H.  R.  R.  R.j  Port  Jervis,  and  all  stations  cast  thereof,  on  the  N.  Y., 
L.  E.  &  U.  R.  R.;  Brookville,  Chaudiere  Junction,  Coaticooke,  Cornwall,  Coteau  Landing,  Mon- 
treal, Prescott,  Pt.  Levi,  Quebec,  Riviere  du  Loup,  Sherbrooke,  St.  Hyacinthe,  and  St.  Johns, 
Canada:  Rouses  Point,  N.  Y. ;  Rutland.  Vt. ;  and  all  stations  on  line  of  Boston  and  Albany  R. 
R. ;  and  stations  on  Hoosac  Tunnel  Line  in  .Massachusetts. 

At  Pittsburgh  rates— From  Buffalo  and  Suspension  Bridge,  N.  Y.;  Wheeling,  W.  Va. ;  Green- 
ville, Sharon,  and  Sharpsville,  Pa.;  Guelph,  Hamilton,  London,  Paris,  Rockwood,  and  Toronto, 
Canada;  Bellaire,  Cleveland,  East  Liverpool,  Leetonia,  Niles,  Portsmouth,  Steuhenville,  and 
Youngstown,  O.;  and  all  stations  on  L.  S.  &  M.  S.  R'y,  between  Buffalo  and  Cleveland;  also 
all  stations  on  P.,  Ft.  W.  and  C.  R'y,  East  Massillon. 

At  Cincinnati  rates— From  Columbus,  Dayton,  Defiance,  Deshler,  Delphos,  Fostoria,  Ilamil- 


193 


ton,  Junction  City,  Lima,  Lockland,  Mansfield,  Middleton,  Monroeville,  Mt.  Vernon,  Newark, 
Sandusky,  Shelby,  Springfield,  Tiffin,  Toledo,  and  Zanesville,  0.;  Detroit,  Mich.:  Auburn, 
Connersville,  Fort  Wayne,  Indianapolis,  Jetfersonville,  Lafayette,  Logansport,  Peru,  Richmond, 
and  Wabash,  Ind.j  Danville,  111.;  and  from  Louisville,  Ky.,  with  Ohio  River,  transfer  charges 
added. 

At  Chicago  rates — From  St.  Paul  and  Minneapolis,  Minn.;  Bement,  Crystal  Lake,  Decatur, 
Delevan,  Elgin,  Freeport,  Lincoln,  Pekin,  Peoria,  Quincy,  Rockford,  Springfield,  Taylorville, 
and  Tolono^Ill.;  Beloit,  Kenosha,  Milwaukee,  and  Racine,  Wis.;  Leavensworth,  Kans. ;  Han- 
nibal, Kansas  City,  St.  Joseph,  and  St.  Louis,  Mo.;  Clinton,  la.;  and  all  points  on  and  east  of 
the  Mississippi  River  on  the  main  lines  of  C,  R.  I.  &  P.,  C.  <fe  N.  W.,  and  C,  B.  &  Q.  Railroads. 

Said  first  parties  also  agree  that  in  case  they,  or  either  of  them,  any  time  during  the  contin- 
uance of  this  agreement,  shall  print  and  publish  a  regular  freight  tariff  from  the  eastern  cities 
hereinbefore  referred  to,  to  California  points,  which  names  lower  rates  upon  any  or  all  articles 
than  the  rates  herein  provided  for  upon  such  articles,  said  second  party  shall  have  the  benefit 
of  such  tariff  rates  upon  such  articles  during  the  time  that  such  tariff  may  remain  in  force. 

And  said  first  parties  furthermore  agree  to  protect  said  second  party  from  any  "  cut"  or  lower 
rates  than  those  hereinbefore  provided  that  may  be  published  or  charged  by  any  other  railroad 
company  or  companies,  which  may  operate  a  through  or  all-rail  line  from  any  or  all  of  the 
eastern  cities  hereinbefore  named,  for  the  purpose  of  diverting  freight  from  the  lines  of  the 
first  parties.  The  intent  and  purpose  of  the  foregoing  being  to  guarantee  to  the  second  party 
rates  which  shall  be  as  low  as  those  charged  and  collected  upon  the  same  articles,  between  same 
points,  by  any  other  all-rail  route  which  may  now  or  at  any  time  during  the  term  of  this  con- 
tract compete  for  the  traffic  of  California. 

Said  first  parties  further  agree  that  in  the  event  of  active  competition  with  the  Pacific  Mail 
Steamship  Company  for  the  traffic  between  New  York  and  San  Francisco,  the  rates  to  be 
charged  the  said' second  party  during  the  period  of  such  excessive  competition,  within  the  term 
of  this  contract,  shall  not  exceed  those  current  by  the  Pacific  Mail  Steamship  Company's  ves- 
sels, at  the  time  of  shipment,  by  more  than  the  following  figures,  i.  e.: 


For  goods  hereinbefore  named  at  following  rates  for 

transportation  from  New  York  : 

All  goods  named  at  rates  not  exceeding  one  dollar  and 
fifty  cents  per  hundred  pounds 

Bates  exceeding  one  dollar  and  fifty  cents,  not  exceed- 
ing two  dollars  and  fifty  cents,  per  hundred  pounds... 

Bates  exceeding  two  dollars  and  fifty  cents,  not  exceed- 
ing four  dollars,  per  hundred  pounds 

Bates  exceeding  four  dollars,  not  exceeding  six  dollars, 
per  hundred  pounds 

Bates  exceeding  six  dollars  per  hundred  pounds 


Excess  of  rail  rates  above  current  rates  by  Pacific  Mail 
steamers  not  to  exceed  : 


Fifty  cents  per  hundred  pounds. 

.Seventy-five  cents  per  hundred  pounds. 
One  dollar  per  hundred  pounds. 


_One  dollar  and  fifty  cents  per  hundred  pounds. 
Three  dollars  per  hundred  pounds. 


It  being  agreed  that  by  the  term  "  current  rates  "  is  to  be  understood  the  average  rates  actu- 
ally charged  and  obtained  by  the  Pacific  Mail  Steamship  Company  upon  goods  of  each  specific 
kind  transported  by  it  upon  the  steamer  receiving  freight  in  New  York  for  San  Francisco,  at 
the  time  that  the  shipment  is  made  by  rail  as  to  which  a  claim  for  reduced  rate  is  made  by  the 
second  party. 

It  is  also  understood  and  agreed,  that  the  above  named  guaranty  as  to  excess  of  rates  above 
Pacific  Mail  Steamship  rates  shall  not  apply  during  any  portion  of  the  term  of  this  contract, 
when  the  rates  of  the  Pacific  Mail  Steamship  Company  from  New  York  to  San  Francisco  are 
subject  to  the  control  of  the  first  parties,  or  either  of  them.  The  said  first  parties  further  agree 
that  the  freight  of  the  said  second  party  shall  be  transported  without  unfavorable  discrimina- 
tion in  the  matters  of  time  and  attention,  as  compared  with  goods  of  the  same  class  consigned 
to  other  parties. 

In  consideration  of  the  guarantee  of  the  foregoing  special  rates  of  freight,  the  second  party 
has  covenanted  and  agreed,  and  does  hereby  covenant  and  agree  to  ship,  or  cause  to  be  shipped, 
by  way  of  the  railroads  owned  or  operated  by  the  first  parties,  and  such  other  connecting  rail- 
roads as  may  be  designated  from  time  to  time  by  the  said  first  parties,  all  the  goods,  wares,  and 
merchandise  handled  by  said  second  party,  which  may  or  shall  be  purchased  in  or  obtained 
from  any  point  in  the  United  States  or  Canadas  east  of  the  meridian  of  Omaha,  during  the 
term  of  this  contract,  for  sale  or  use  on  the  Pacific  Coast,  whether  such  goods  are  shipped  in  the 
name,  or  for  account  of  said  second  party,  or  otherwise. 

It  is  mutually  understood  and  declared  that  the  object  of  this  agreement  is  to  secure  for  and 
give  to  the  first  parties  the  transportation  of  all  goods  handled  by  said  second  party,  which 
may  be  shipped  from  the  Eastern  States  and  Canadas  to  Sail  Francisco,  or  other  port  or  point 
of  distribution  on  the  Pacific  Coast,  during  the  term  of  this  contract.  Also,  that  said  second 
party  is  aide  to  control  the  matter,  and  direct  the.  manner  of  shipping  said  ;;'<>ods,  and  that  in 
the  event  of  any  portion  of  said  goods  being  diverted  from  the  routes  by  which  it  is  herein 
agreed  they  shall  be  shipped,  such  conversion  shall  be  construed  as,  and  held  to  be,  prima 
facie  evidence  of  default  in  the  performance  of  this  agreement  by  said  second  party  ;  and  it 
shall  then  be  optional  witli  said  first  parties  to  annul  the  agreement,  or  to  collect,  as  liquidated 

13 b 


194 

damages,  a  sum  equivalent  to  the  charges  said  goods  would  have  been  subject  to  if  shipped  by 
rail  in  accordance  with  the  terms  of  this  agreement. 

It  is  also  mutually  understood  and  particularly  agreed  that  the  special  rates  of  freight  herein 
provided  are  Cor  the  sole  use  and  benefit  of  the  second  party;  and  that  said  second  party  shall 
not  allow  the  use  of  its  name  or  shipping  marks  in  any  way.  or  by  any  other  party  or  parties, 
which  shall  procure  for  said  other  party  or  parties  the  benefit  of  said  special  rates  of  freight  ; 
and  it  is  expressly  stipulated  that  in  case  said  second  party  shall  apply,  by  sale  or  otherwise, 
any  party  or  parties  who  are  known  to  handle  goods  which  have  been  shipped  via  any  route 
not  herein  designated,  from  the  territory  easl  of  the  meridian  of  Omaha  to  any  point  or  points 
on  the  Pacific  Coast  of  the  United  States,  or  to  British  Columbia,  during  the  term  of  this  agree- 
ment, said  second  party  shall  pay  or  cause  to  be  paid  to  said  first  parties  freight  at  the  regular 
tariff  rates  on  the  good's  so  supplied  ;  in  default  of  which  said  first  parties  shall  have  the  rigid, 
at  their  option,  to  cancel  and  annul  this  agreement. 

For  the  present  and  until  further  notice  shipments  made  by  the  following  routes: 

From  New  York,  via  either  the  New  York  Central  and  Hudson  River  Railroad:  the  New 
York,  Lake  Erie  and  Western  Railroad  (formerly  called  the  Erie  Railway):  the  Pennsylvania 
Railroad,  or  the  Baltimore  and  Ohio  Railroad,  as  may  be  designated  by  the  OJeneral  Agents  of 
the  first  parties,  to  whom  shippers  should  apply  for  information  as  the  route  via  which  the 
Commissioner*  of  the  trunk  line  wishes  that  shipments  should  be  made  from  New  York,  and 
from  whom  bills  of  lading  for  New  York  shipments  should  be  obtained. 

From  Boston,  via  either  the  Boston  ami  Albany  Railroad,  the  Hoosac  Tunnel  Line,  or  the 
steamers  of  the  Baltimore  and  Ohio  Line. 

From  stations  on  the  Boston  and  Albany  Railroad,  and  stations  on  the  Hoosac  Tunnel  Line, 
via  those  lines,  respectively. 

From  Philadelphia  and  Harrisburg,  Pa.,  and  Trenton,  N.  J.,  via  the  Pennsylvania  R.  R. 

From  Baltimore,  via  the  Baltimore  and  Ohio  Railroad. 

From  Richmond,  Petersburg,  Lynchburg,  Gordonsville,  Charlottesville,  and  Staunton,  Ya., 
and  Charleston,  W.  Va.,  via  the  Chesapeake  and  Ohio  Railroad. 

From  Albany  or  Troy,  N.  Y.,  Rutland,  Vt.,  and  all  stations  on  Hudson  River  Division  of  the 
N.  Y.  C.  and  H.  R.  R.  R.,  via  the  New  York  Central  and  Hudson  River  Railroad. 

From  Buffalo  and  Suspension  Bridge,  via  any  railroad  line  leading  westerly  from  those  points. 

From  Cleveland,  0.,  and  local  stations  upon  the  line  of  said  road,  via  the  Lake  Shore  and 
Michigan  Southern  Railway. 

From  Newark,  N.  J.,  via'either  the  Pennsylvania  Railroad,  or  the  New  Y'ork,  Lake  Erie,  and 
"Western  Road. 

From  Pittsburgh,  via  the  Pittsburgh,  Fort  Wayne,  and  Chicago  Railway,  or  the  Pittsburgh 
and  Lake  Erie  Railroad. 

From  Alleghany,  Pa.,  via  the  Pittsburgh,  Fort  Wayne, and  Chicago  Railway. 

From  Portsmouth, 0.,  via  the  Scioto  Valley  R.  R., or  the  Baltimore  and  Ohio  Railroad. 

From  Wheeling  and  Bellaire,  via  the  Baltimore  and  Ohio  Railroad  and  the  Cleveland  *nd 
Pittsburgh  Railroad. 

From  Steubenville  and  East  Liverpool.  0.,  via  the  Cleveland  and  Pittsburgh  Railroad. 

From  Montreal,  Quebec,  Reviere  du  Loup,  Pt.  Levi,  Coaticooke,  Rockwood,  Sherbrooke,  St. 
Johns,  Coteau  Landing,  Toronto,  Chandiere  Junct.,  St.  Hyacinthe,  and  Rouses  Point,  via  the 
Grand  Trunk  Railway. 

From  Cornwall,  Prescott,  Brockville,  Toronto,  Hamilton,  Guelph,  Paris,  and  London,  Ont., 
via  the  dieat  Western  Railway  of  Canada. 

From  Cincinnati,  via  either  the  Cincinnati.  Hamilton,  and  Dayton  Railroad;  the  Indianapo- 
lis. Cincinnati,  and  Lafayette  Railroad,  or  the  Ohio  and  Mississippi  Railway. 

From  Dayton,  Hamilton,  Lima.  Lockland,  and  Middletown,  0.,  Richmond  and  Connersville, 
Ind.,  via  the  Cincinnati,  Hamilton,  and  Dayton  Railroad. 

From  Toledo,  0..  via  either  the  Wabash,  St.  Louis,  and  Pacific  Railroad,  or  the  Lake  Shore 
and  Michigan  Southern  Railway. 

From  Chicago,  via  either  the  Chicago  and  Northwestern  Railway:  the  Chicago,  Rock  Island" 
and  Pacific  Railroad;  the  Chicago,  Burlington,  and  Quincy  Railroad:  the  Wabash,  St.  Louis, 
and  Pacific  Railway,  or  the  Chicago  and  Alton  Railroad. 

From  St.  Louis,  via  either  the  Wabash,  St.  Louis,  and  Pacific  Railway,  the  Missouri  Pacific 
Railway,  or  the  Chicago  and  Alton  Railroad. 

From  New  Orleans,  via  the  Chicago,  Si.  Louis,  and  New  Orleans  Railway,  or  New  Orleans 
and  Mobile,  and  Mobile  and  Ohio  Railroad-. 

Prom  Sharon,  Greenville,  and  Sharpsville,  Pa.,  Delphos,  Youngstown,  Niles,  and  Leetonia, 
0.,  via  the  Pittsburg,  Fort  Wayne,  and  Chicago  Railway. 

Frond  Detroit,  Mich.,  via  the  Michigan  Central  Railroad. 

From  Sandusky  and  Defiance,  Junction  City,  Zanesville,  Newark.  Mount  Vernon,  Mansfield, 
Shelby,  NTonroeville,  Tiffin,  Fostoria,  DeBhler,  0.,  and  Auburn,  Ind.,  via  the  Baltimore  and 
Ohio  Railroad. 

From  Fort  Wayne,  lml..  via  either  Wabash,  St.  Louis  and  Pacific  Railway,  or  the  Pittsburg, 
Fort  Wayne,  and  Chicago  Railway. 


395 

From  Peru,  Wabash,  Logansport,  Lafayette,  Ind.,  and  Danville.  111.,  via  the  Wabash,  St. 
Louis,  and  Pacific  Railway. 

From  Columbus.  Dayton,  Springfield,  0.,  and  Richmond,  Ind.,  via  the  Pittsburg,  Cincinnati, 
ami  St.  Louis  Railway,  by  way  of  Chicago  only. 

Prom  Jeffersonville,  Ind.,  and  Louisville,  Ky..  via  J.,  M.  and  I.  R.  R. 

From  Bement,  Tolono,  Decatur,  Springfield,  Taylorville,  Lincoln,  Delevan,  Pekin,  and  Peo- 
ria. 111.,  via  the  Wabash,  St.  Louis,  and  Pacific  Railway,  and  from  points  upon  the  main  line 
of  the  Chicago  and  Northwestern  Railway,  the  Chicago,  Rock  Island  and  Pacific  Railroad,  or 
the  Chicago,  Burlington,  and  Quincy  Railroad,  via  such  mads  respectively. 

From  Milwaukee,  Kenosha,  Racine,  and  Beloit,  Wis.,  via  either  the  Chicago  and  Northwest- 
ern Railway  or  the  Western  Union  Division  of  the  Chicago,  Milwaukee,  and  St.  Paul  Railroad. 

From  Whitewater,  Wis.,  via  t^he  Chicago,  Milwaukee,  and  St.  Paul,  and  the  Chicago,  Rock 
Island,  and  Pacific  Railroads. 

From  Hannibal,  Mo.,  via  the  Hannibal  and  St.  Joseph  Railroad. 

From  St.  Joseph  and  Leavenworth,  via  the  Union  Pacific  Railway,  (Kansas  Division). 

From  Kansas  City,  via  the  Union  Pacific  Railway,  (Kansas  Division),  or  the  Atchison,  Tope- 
ka,  and  Santa  Fe  Railroad. 

From  all  stations  in  Missouri  on  the  main  line  of  the  Missouri  Pacific,  or  the  Wabash,  St. 
Louis,  and  Pacific  Railway,  via  those  lines,  respectively. 

It  is  further  mutually  understood  and  agreed,  that  in  case  the  first  parties  shall  at  any  time 
have  reason  to  believe  that  the  second  party  has  violated  or  disregarded  the  terms  of  this  agree- 
ment, said  first  parties  shall  have  the  right  to  examine  the  books  and  papers  of  the  second 
party,  in  so  far  as  may  be  necessary  to  determine  the  truth  of  the  matter  in  question. 

It  is  further  mutually  understood  and  agreed,  by  and  between  the  parties  thereto,  that  all  the 
freight  covered  by  this  agreement  shall  lie  shipped  via  such  routes  as  may  be  designated  from 
time  to  time  by  the  first  parties;  and  that  said  first  parties  shall  not  be  deemed  or  held  respon- 
sible for  any  overcharge  in  the  rates  of  freight  which  may  be  made  upon  goods  that  shall  not 
have  been  shipped  by  the  carriers  so  designated. 

It  is  further  mutually  understood  and  agreed,  that  all  freight  shipped  under  or  covered  by 
this  agreement  shall  be  truly  and  accurately  described  by  the  use  of  definite, not  general,  terms, 
and  as  far  as  true  and  practicable,  by  terms  used  in  the  tariff  of  the  first  parties  hereto,  so  that 
the  proper  rate  to  be  applied  may  be  determined  without  inspection  of  the  contents  of  the 
packages  by  the  carrier;  and  that,  in  cases  of  doubt  as  to  the  exact  nature  of  the  contents  of 
any  package  of  freight  consigned  to  said  second  party,  the  carriers  shall  have  and  are  hereby 
accorded  the  right  either  to  open  said  packages  or  to  inspect  the  original  invoices  of  purchase 
for  the  contents  of  said  packages,  in  order  to  determine  the  proper  rate  to  be  charged  thereon; 
and  that  in  case  it  shall  be  found  that  any  such  package  or  packages  contain  freight  of  a  higher 
class  than  that  specified  by  shippers  of  same — the  nature  id'  the  goods  having  been  willfully 
misrepresented  for  the  purpose  of  obtaining  a  lower  rate  upon  the  same  than  which  would 
have  been  obtained  under  t  bis  agreement  had  the  goods  been  truly  described — the  carriers  shall 
have  and  are  hereby  accorded  the  right  to  charge  upon  such  package  or  packages  so  mis- 
described,  double  the,  regular  tariff  rate  upon  same. 

It  is  further  mutually  understood  and  agreed  that  all  freight  shipped  under  this  agreement 
is  to  be  shipped  subject  to  the  rules,  regulations,  and  conditions  named  in  the  regular  freight 
tariffs  of  the  first  parties  in  effect  at  the  time  of  shipment,  and  that  the  first  parties  and  all 
other  carriers  which  may  transport  the  freight  have  been  released  or  are  hereby  released  from 
all  liability  for  chafage  of  goods  packed  in  bales,  and  other  injury  or  loss  arising  from  imper- 
fect packages,  and  all  other  liabilities  as  insurers  of  any  and  all  goods  for  which  said  tariff 
provides  a  "  released"  rate,  or  provides  two  rates,  the  lower  of  which  is  conditioned  upon  the 
signing  by  the  shipper  of  a  release  of  the  form  furnished  by  the  company. 

It  is  further  mutually  understood  arid  agreed,  that  at  the  option  of  the  first  parties,  all  or  any 
of  the  freight  referred  to  in  or  covered  by  this  agreement,  may  be  waybilled  at  the  special  rates 
herein  named,  or  al  the  tariff  rates  current  at  the  time  of  shipment.  In  the  latter  case,  the 
charges  as  waybilled  shall  be  paid  by  the'  second  party,  upon  the  delivery  of  the  freight,  and  at 
the  end  of  each  calendar  month,  upon  the  presentation  of  the  bills  for  charges  paid  to  the  gen- 
eral freight  agent  of  the  Central  Pacific  Railroad  Company,  at  San  Francisco,  together  with  the 
bills  of  lading  lor  such  freight  (provided  that  such  bills  of  lading  have  not  previously  been  sur- 
rendered to  the  Centra]  Pacific  Railroad  Company),  or  within  a  reasonable  time  thereafter,  in 
which  to  adjust  and  audit  the  bills,  the  difference  between  tie-  charges  collected  upon  the  deliv- 
ery of  the  freight  and  the  amount  to  be  paid  under  this  agreement  shall  be  refunded  to  the  said 
second  party. 

This  agreement  to  take  effect .  18—,  (provided  that  no  goods  are  then  afloat  from  any 

city  upon  the  American  Atlantic  seaboard  for  said  second  party),  and  is  to  remain  in  force  until 
December  31,  lss2.  unless  sooner  canceled  by  the  first  parlies,  as  and  for  the  causes  hereinafter 
named. 

In  witness  whereof,  the  first  parties  have  caused  these  presents  to  be  subscribed  by  their  general 


196 

freight  agents,  and  the  second  party  has  hereunto  set  its  hand,  upon  the  day  and  year  first  above 
written. 

The  Union  Pacific  Railway  Company,  by ,  General  Freight  Agent. 

The  Atchison,  Topeka,  and  Santa  Fe  Railroad  Company,  by ,  General  Freight  Agent. 

The  Missouri  Pacific  Railway  Company,  for  itself  and  the  St.  Louis,  Iron  Mountain,  and 
Southern  Railway  Company:  the  International  and  Great  Northern  Railroad  Company, 
and  the  Texas  and  Pacific  Railway  Company,  by ,  General  Freight  Agent. 

Q.  What  effect  has  that  special  contract  system  upon  the  shippers 
of  this  State?  A.  The  effect  is  to  drive  the  ships  from  the  San  Fran- 
cisco trade,  and  consequently  to  relieve  the  railroad  company  of 
competition,  its  effect  falling  heavily  upon  our  farmers — causing  a 
loss  to  them  of  from  five  to  ten  millions  of  dollars  per  year — it  further 
results  in  favoritism,  or  coercion,  at  the  pleasure  of  the  company. 
Here  is  another  special  contract: 

[The  Clerk  read  as  follows:] 

"  THE    RAILROAD    AND    THE    WINE   INTEREST. 

"The  general  rates  adopted  by  the  railroad  monopoly  compel  the 
payment  of  a  freight  charge  sometimes  from  double  to  treble  that  to 
which  it  will  agree  by  special  contract.  The  result  of  this  is,  that  no 
one  in  California,  out  of  a  population  of  eight  hundred  thousand, 
can  get  a  comparatively  reasonable  charge  for  transportation,  unless 
by  a  special  interview  and  a  written  contract  with  the  company.  A 
correspondent  of  the  Examiner  writes  that  he  desired  to  send 
some  wine  to  New  York,  and  asked  the  charge,  and  was  told:  'It 
will  be  six  dollars  per  hundred  pounds,  but,  by  signing  a  contract, 
we  will  take  your  wine  to  New  York  at  two  dollars  and  a  half  per 
hundred.'  Here  is  the  contract.  It  shows  how  far  such  contracts 
are  reluctantly  accepted  by  shippers: 

"  SEASON  FREIGHT  RELEASE. 

"Whereas,  The  undersigned  ,  in  the  constant  practice  of  shipping  goods,  wares,  and 

merchandise  on  the  railroad  lines  of  the  Central  Pacific  Railroad  Company  and  its  connecting 
transportation  companies  from  San  Jose  to  divers  parties  at  divers  places  on  said  lines; 

"  And  whereas  said  railroad  company  and  its  connections  propose  to  ship  all  such  goods,  wares, 
and  merchandise  at  special  rates,  which  are  less  than  the  usual  and  customary  rates,  in  consid- 
eration   of releasing    them    from   all    liability   as    insurers  of   such  goods,  wares,  and 

merchandise,: 

"  And  whereas  the  undersigned  desire  to  secure  the  benefit  of  such  special  rates,  and  to  avoid 
the  trouble  and  inconvenience  of  executing  a  separate  contract  for  each  shipment; 

•'  Now,  therefore,  in  consideration  of  the  premises,  and  the  further  consideration  of  one  dollar, 
tome  in  hand  paid,  the  receipt  whereof  is  hereby  acknowledged  and  confessed,  I  do  hereby 
release  the  said  Central  Pacific  Railroad  Company,  and  all  other  transportation  companies  over 
whose  lines  said  goods  may  pass  to  destination,  from  all  liability  as  insurers  of  any  and  all 
goods,  wares,  ami  merchandise,  which  may  be  shipped  by  me  at  such  special  rates  on  any  or 
either  of  the  railroad  lines  of  said  company  or  companies  between  the  date  of  this  instrument 
and  the  thirty-first  day  of  December,  eighteen  hundred  and  eighty-two. 

"  In  testimony  whereof,  I  have  hereunto  set  my  hand  and  affixed  my  seal  on  this  thirtieth 
day  of  August,  A.  D.  eighteen  hundred  and  eighty-two." 

[General  Naglee  resumed:] 

I  think  I  said  that  the  charges  made  on  freights  were  very  high. 
Gould  started  in  business  in  Santa  Clara.  He  went  to  the  railroad 
company,  and  said  :  "  I  want  to  send  some  fruit  to  the  East.  What 
will  it  cost  ?  "    They  said:     "  We  will   take  a   carload   through   for 


197 

$350,"  and  a  carload  was  shipped.  When  the  returns  came  in,  Gould 
says:  "I  did  pretty  well  on  that.  I  made  over  a  thousand  dollars 
on  it."  In  a  short  time  he  went#to  the  company  again  and  said: 
"  I  want  to  send  two  carloads  East.  What  will  you  charge?"  "Five 
hundred  dollars  a  car."  Well,  he  sent  that,  and  then  wanted  three 
carloads  sent;  but  they  increased  the  price  till  they  charged  him  as 
high  as  $600  a  carload.  Now,  if  our  fruit  could  be  shipped  at 
reasonable  prices,  I  have  no  doubt  in  the  world  but  we  could  sell  all 
the  early  fruit  in  Boston,  New  York,  Chicago,  and  Philadelphia 
markets.  The  railroad  company  make  hundreds  of  thousands  of 
dollars,  and  the  whole  thing  is  crowded  down  by  their  exactions. 

Q,  Do  you  know  of  any  other  circumstances  of  this  character? 
A.  I  hear  somebody  almost  every  day  making  some  complaint. 

Q.  Do  you  know  of  an  instance  connected  with  some  pome- 
granates? A.  I  heard  of  an  instance  of  some  promegranates,  which 
a  friend  of  mine  sent  with  some  oranges  to  the  city.  Some  of  his 
people  put  them  into  the  same  boxes  with  the  oranges.  When  they 
discovered  the  pomegranates,  the  railroad  made  them  pay  two  or 
three  times  as  much.  They  charged  sixty  cents  a  box  for  oranges, 
and  $1  SO  for  pomegranates,  although  they  did  not  occupy  any  more 
space,  but  it  is  a  rule  they  have  that  everything  shall  pay  all  it  will 
bear. 

Senator  Sullivan — Do  you  know,  as  a  matter  of  fact,  whether 
there  is  a  contract  besides  the  one  to  which  we  have  just  listened, 
which  is  called  the  "  Pink  Tariff?  "  A.  No,  sir;  there  was  a  contract 
which  was  made  with  some  eight  or  ten  wine  men  in  San  Francisco, 
who  were  associated  together,  on  very  extraordinary  terms,  and  was 
rated  very  much  in  their  favor,  but  I  believe  it  has  been  aban- 
doned. 

Q.  You  don't  know,  as  a  matter  of  fact,  that  any  special  rates  have 
been  granted  in  addition  to  the  special  contract?    A.  No,  sir. 

Q.  Would  you  be  kind  enough  to  give  the  committee  a  further 
statement  in  regard  to  the  effect  of  the  special  contracts  upon  the 
shipping  interests  of  the  State?  A.  I  conceive  that  the  great  object 
of  the  special  contract  was  to  cut  off  the  shipping  and  to  compel  the 
merchants  to  bring  the  greater  part  of  their  goods  across  the  conti- 
nent, and  they  will  require  a  much  larger  charge  than  if  shipped  by 
vessel.  Freights  have  varied  from  four  and  five  pounds  down  to 
two  pound  ten. 

Q.  Under  which  interest  would  the  farmers  of  the  State  receive 
the  most  benefit?  A.  I  estimate  that  the  farmers  of  the  country,  by 
excluding  the  ships,  would  lose  from  five  to  ten  million  a  year. 
From  five  to  ten  dollars  a  ton.  I  think  that  my  loss  in  that  direc- 
tion was  from  five  to  ten  dollars  a  ton  this  year.  But  I  do  not  care 
so  much  about  that  as  I  do  that  the  interest  of  wines  and  fruit  are 
being  kept  back,  and  they  have  tried  to  interfere  with  the  manufac- 
turing interests  of  this  State  in  such  a  way  as  to  discourage  those 
seeking  to  establish  manufactories  here. 

Q.  Do  you  know,  as  a  matter  of  fact,  that  this  committee  received 
a  letter  from  one  of  the  manufacturing  industries  of  this  State — a 
sugar  refinery  at  Alameda  County — as  to  the  effect  of  the  Barry  bill, 


198 

and  that  if  it  was  passed  they  would  have  to  shut  up  their  works? 
A.  This  is  the  first  that  I  have  heard  of  the  letter. 

Q.  It  was  from  a  beet  sugar  refinery  at  Alvarado?  A.  As  far  as 
the  beet  sugar  business  is  concerned,  I  have  yet  to  learn  that  it  has 
been  a  success.  On  the  contrary,  the  information  that  I  have  had 
was  to  the  effect  that  it  was  doubtful  if  the  people  making  beet 
sugar  were  likely  to  succeed.  If  it?  had  been  a  very  great  success  I 
think  I  would  have  heard  of  it. 

Q.  In  explanation  it  was  said  that  they  intended  to  make  a  beet 
sugar  manufactory  there,  and  also  to  import  the  cane,  and  make 
a  sugar  refinery.  The  proposition  was  to  ship  the  cane  from  the 
Islands,  and  then  transport  it  over  a  narrow  gauge  road  to  Alvarado, 
where  they  are  now  manufacturing.  They  shipped  it  to  San  Fran- 
cisco, and  then  back  again  to  San  Francisco,  by  the  South  Pacific 
Coast  Railroad?  A.  There  were  three  or  four  companies  in  San 
Francisco,  and  they  were  till  lately  subsidized  by  Glaus  Spreckels. 

Q.  They  were  going  to  compete  with  Glaus  Spreckels,  and  in  order 
to  do  that  they  had  to  have  their  rate  lowered  for  sugar  and  coal  from 
San  Francisco  to  Alvarado  and  back  again  to  San  Francisco,  and 
that  if  they  were  not  permitted  to  discriminate  in  that  direction 
the  enterprise  could  not  be  started?  A.  It  was  a  question  of  but 
a  few  miles  and  I  don't  see  how  that  could  affect  the  matter  of  an 
interest  of  that  kind.  My  impression  is  that  there  is  water  commu- 
nication there. 

Q.  Not  for  iron  steamers.  They  would  have  to  land  at  the  wharf 
in  San  Francisco  and  then  put  their  material  on  the  cars  and  take  it 
to  Alvarado.  The  parties  made  the  proposition  that  they  would 
carry  it  so  low  as  to  make  it  a  loss,  and  they  hoped  to  build  it  up  by 
running  a  factory  there  and  charging  for  other  business  at  the  regu- 
lar rates?     A.  I  have  heard  nothing  of  that  matter  at  all. 

Senator  Del  Valle — You  were  asked  this  morning  whether  if 
the  maximum  of  freight  was  fixed  that  the  railroad  company  could 
discriminate  beyond  it?    A.  It  only  limits  them  to  the  maximum. 

Q,  Do  you  mean  by  that  to  say  that  they  could  discriminate  as 
between  persons  ?     A.  No,  sir. 

Q.  But  they  could  between  classes?  A.  Yes,  sir;  but  within  the 
maximum. 

Q.  In  shipping  wines  do  you  get  your  kegs  back?  A.  No  ;  not  in 
shipping  east. 

Q.  Have  you  any  knowledge  as  to  whether  other  industries,  such  as 
beer,  have  their  kegs  shipped  back  ?    A.  Yes,  sir. 

Q.  Do  you  know  the  weight  of  a  barrel  of  beer?  A.  I  estimate  it 
by  the  weight  of  water.  Seven  and  a  half  pounds  to  the  gallon; 
and  in  addition  to  the  beer  you  must  take  into  consideration  the 
heavy  hoops  and  the  thickness  and  weight  of  the  staves. 

Q.  Isn't  it  a  fact  that  in  shipping  those  return  packages,  although 
they  may  not  weigh  more  than  forty-five  pounds,  yet  they  have  to 
pay  the  regular  rate  of  one  hundred  pounds  for  each?  A.  If  you 
comedown  to  a  small  proposition  like  that  it  amounts  to  nothing, 
for  the  simple  reason  that  when  you  come  to  the  matter  of 
freight   they   carry  five   hundred  and   fifty  million   tons  one  mile 


199 

and  it  is  useless  to  come  down  to  a  matter  of  a  few  cents.  They 
may  have  a  great  many  rules  and  different  rates;  for  instance,  the 
bull  "or  the  stallion  which  are  counted  at  four  thousand  pounds 
each.  Most  persons  are  not  familiar  with  these  facts.  The  simple 
question,  and  it  seems  the  more  reasonable  rule,  would  be  to  put 
them  upon  the  ground  that  they  are  a  company,  and  that  they  should 
be  allowed  a  reasonable  per  cent  upon  the  money  invested.  It  is  no 
use  coming  down  to  those  small  matters  when  the  big  item  is  "the 
result.  I  don't  think  that  the  object  of  the  people  is  to  get  down  to 
the  trifles,  but  to  prevent  the  railroad  company  from  cinching  people. 

Q.  Do  you  know  of  any  special  contract  made  by  the  railroad 
company  with  Claus  Spreckels?    A.  Only  by  general  report. 

Q.  Do  you  not  know  as  a  matter  of  fact  that  the  Central  Pacific,  by 
its  tariff,  actually  prevents  eastern  shippers  sending  sugar  to  Cali- 
fornia?    A.  Only  from  hearsay. 

Q.  Do  you  know  a  case  where  a  special  contract  has  been  given 
which  has  not  been  given  to  other  merchants  in  the  same  business? 
A.  I  only  know  about  all  these  matters  from  hearsay.  I  heard  of  a 
report  of  a  contract  between  the  railroad  company  and  Coleman,  by 
which  Coleman 

[Objection.] 

Q.  Do  you  know  of  a  case  where  the  railroad  company  refused  to 
give  a  contract?  A.  Yes,  sir ;  this  was  told  to  me  by  the  parties  them- 
selves ;  the  facts  were  that  they  applied  to  the  railroad  company  for 
a  special  contract,  and  the  answer  was:  "  Give  us  the  names  of  the 
parties  that  you  are  dealing  with."  The  names  of  the  persons  with 
whom  they  dealt  were  on  their  black  list  in  the  office,  and  they 
replied  :  "  We  won't  give  you  a  contract." 

Q.  Do  you  know  of  an  instance  where  they  have  annulled  a  special 
contract,  upon  the  ground  that  a  person  having  dealt  with  one  who 
brought  goods  by  sea?  A.  I  know  of  an  instance  where  they  had 
put  a  penalty  on  for  his  having  bought  agricultural  implements 
which  were  brought  over  the  water,  and  his  contract  was  taken  from 
him,  and  afterwards  he  was  charged  the  full  price. 

Q.  Do  you  know  anything  about  the  question  of  "rebate?"  A. 
"Rebate"  is  where  there  is  an  understanding  between  the  parties 
that  they  shall  charge  a  man  the  open  rates  on  his  freight,  and  after- 
wards allow  him  a  "rebate"  or  subtraction,  which  brings  it  down  to 
the  special  rate. 

Q.  Are  these  overcharges?  A.  There  are  always  two  charges  on 
everything.  There  is  a  special  contract,  which  means  a  lower  figure 
than  the  open  rates,  only  the  open  rates  are  two  or  three  times  as 
great.  The  principle  upon  which  the  thing  rests  is,  that  you  are 
forced  to  go  into  th,e  special  contract,  for  the  reason  that  you  cannot 
afford  to  do  business  and  pay  double  or  triple  what  other  people  do. 

Q.  Have  you  ever  known  the  Central  Pacific  Railroad  Company 
or  the  Southern  Pacific  Railroad  Company  to  remove  their  tracks 
from  any  place  which  they  wished  to  discriminate  against?  A. 
There  was  a  notorious  case  occurred  a  few  years  ago,  in  which.  Sena- 
tor J.  P.  Jones  was  interested.  He  built  a  railroad  from  Los  Angeles 
to  Santa  Monica,  and  a  wharf  out  to  deep  water  was  built  at  the 


200 

latter  place.  Jones  became  involved  and  sold  his  railroad  to  Stan- 
ford &  Crocker,  and  they  destroyed  the  wharf,  so  that  further  com- 
petition should  not  be  possible. 

Q.  Do  you  know  of  any  other  instance?  A.  No,  sir;  I  don't  know 
any  of  destroying  property. 

Q.  Do  you  know  of  any  that  occurred  at  Santa  Cruz?  A.  They 
made  a  wide  gauge  there,  and  took  up  the  narrow  gauge. 

Senator  Kellogg  (Chairman) — What  is  Ihe  usual  weight  allowed 
to  a  carload?  A.  Usually,  about  ten  tons.  And  if  they  are  in  a 
hurry  in  the  harvest  time,  they  will  allow  you  about  fifteen.  Some- 
times they  will  let  you  put  in  more  than  the  regular  allowance,  and 
then  charge  you  double  price;  but  the  capacity  is  about  ten  tons. 

Q.  How  many  stallions  can  be  shipped  at  one  carload,  with  the 
proper  conveniences  for  protection  for  that  sort  of  animals  ?  A.  That 
depends  a  good  deal  upon  the  character  of  the  animals — whether  you 
use  a  whole  box-car,  or  whether  you  divide  the  car  into  stalls. 

Q.  When  a  single  stallion  is  shipped,  does  it  not  necessitate  the 
sending  of  a  single  car?  A.  I  suppose  there  is  seldom  more  than 
one  offered  at  a  time. 

Q.  It  would  require  about  a  half  a  car  to  ship  a  stallion  ?  A.  A 
partition  could  be  put  in,  so  that  you  could  ship  other  stock — so  that 
you  could  ship  several. 

Q.  The  handling  of  a  stallion  would  be  very  different  from  the 
handling  of  other  stock?     A.  Yes,  sir. 

Q.  It  would  require  more  care  and  more  labor?     A.  Yes,  sir. 

Q.  Do  you  think  that  would  be  any  reason  for  a  discrimination  in 
charging?  A.  I  think,  as  I  told  you  awhile  ago,  that  the  business  is 
so  large  that  it  would  hardly  pay  to  notice  these  small  items,  because 
when  you  take  them  all  they  don't  amount  to  anything. 

Q.  Your  supposition  is  there  should  be  so  much  paid  for  a  stallion 
instead  of  so  many  pounds?  A.  The  question  is,  whetheryou  would 
put  it  in  that  way.  Where  there  is  risk,  of  course  they  should  be 
allowed  to  charge  a  little  more. 

Q.  The  company  would  be  bound  to  transport  it  safely?  A.  Of 
course;  and  they  take  the  risks  on  everything  else. 

Q.  They  have  to  use  the  necessary  precautions?  A.  They  have  to 
use  proper  diligence. 

Q.  And  a  greater  amount  of  diligence  in  case  of  a  stallion  than  in 
other  things?  A.  Well,  you  come  back  at  last  to  where  I  left  you. 
When  you  come  to  look  over  it  at  the  end  of  the  year  and  find  the 
entire  amount,  it  don't  amount  to  anything.  Put  in  all  losses  by  acci- 
dent at  fifty  thousand  dollars,  and  then  divide  it  by  twenty-five  mil- 
lions, add  this  portion  to  the  freight,  and  you  dispose  of  this  whole 
subject  of  risk. 

Q.  In  the  shipment  of  a  stallion  does  it  require  any  more  than 
ordinary  care  in  handling?     A.  I  suppose  some  of  them  do. 

Q.  It  requires  more  care  and  attention  than  ordinary  freight? 
A.  Yes,  sir. 

Q.  Do  you  think  that  would  be  any  reason  for  charging  more  for 
the  shipping?     A.  I  think  so. 

Q.  In  your  judgment,  do  you  think  that  each  article  ought  to  be 


201 

charged  for  the  services  required  to  ship  that  particular  freight? 
A.  I  think  that  in  all  matters  of  this  kind  you  could  simplify  the 
matter  very  much,  and  it  should  be  to  the  greatest  possible  extent. 
If  you  do  charge  more  in  one  instance  you  credit  in  the  other.  You 
charge  on  both  sides  of  the  ledger,  and  when  you  want  the  results  at 
the  end  of  the  year  it  may  be  that  in  striking  the  balance  you  will 
strike  both  off  again.  Adopt  the  plan  suggested  by  me,  and  allow 
the  company,  in  this  settlement  with  the  State,  all  of  their  just  and 
economical  expenses,  and  the  cost  and  trouble  of  loading  the  trouble- 
some vicious  stallions  would  be  returned  to  the  company. 

Q.  I  understood  you  to  say  that  in  your  judgment  the  builder  of 
a  railroad  ought  to  be  allowed  a  reasonable  interest  on  the  invest- 
ment. What,  in  your  judgment,  would  be  a  reasonable  interest  on 
the  investment?  A.  I  should  allow  them  five  per  cent,  which  would 
be  two  per  cent  more  than  ordinary  interest  received  at  the  present 
time  on  large  sums  of  money.  If,  on  the  contrary,  you  think  it 
unreasonable,  give  them  six  or  seven. 

Q.  In  your  best  judgment,  what  are  the  profits  realized  from  an 
ordinary  business  here  in  the  State?  A.  Well,  as  far  as  money 
investments  are  concerned,  four  per  cent;  and  if  you  have  to  pay 
taxes,  five  per  cent.  As  far  as  business  is  concerned,  at  the  present 
time  I  do  not  think  that  it  pays  more  than  five  or  six  per  cent. 
Now,  in  other  business  there  is  more  or  less  risk,  but  as  far  as  rail- 
roading is  concerned,  there  is  no  loss  at  all ;  they  are  all  compelled 
to  pay  in  advance.  I  do  not  know  that  they  ever  lost  any  money. 
The  instructions  are  not  to  deliver  the  goods  until  paid  for.  They 
refused  my  check  the  other  day  for  seventeen  dollars,  requiring  the 
cash. 

Q.  Do  you  think  that  there  should  be  any  discrimination  between 
persons  in  shipping  goods,  the  classes  of  goods  and  all  the  circum- 
stances being  equal  ?  A.  I  should  say  that  there  should  be  no  dis- 
crimination between  persons,  or  places,  as  far  as  that  is  concerned. 
I  cannot  see  any  necessity  for  it. 

Q.  You  spoke  about  the  railroad  company  requiring  a  bond.  Was 
there  any  reason  why  they  should  do  it  in  any  case?  A.  If  it  was  a 
stranger  to  them. 

Q.  You  would  not  discriminate  between  persons  ordinarily?  A. 
When  you  have  been  dealing  with  a  man  for  a  long  time,  and  you 
know  that  he  is  a  responsible  person  in  every  respect,  then  there  is 
no  risk  there.  If,  on  the  contrary,  a  new  person  came  along,  they 
should  take  his  case  subject  to  rule  and  to  reason.  The  company 
relieve  themselves  of  all  responsibility  by  the  terms  of  their  special 
contract,  and  in  the  single  exception  of  perishable  goods  they  might 
secure  themselves  against  loss  of  freight.  With  an  irresponsible  per- 
son they  might  exact  security. 

Q.  Do  you  think  that  it  would  be  reasonable  to  require  one  class 
of  persons  to  give  a  bond  while  other  persons  of  the  same  class  should 
not  be  required  to  do  so?  A.  That  is  a  matter  that  the  railroad  com- 
pany should  judge,  as  to  whether  there  would  be  a  probable  loss  or 
not. 

Q.  What  is  the  reason  why  they  require  a  bond  for  freight  in  the 
case  of  the  shipment  of  green  fruit?     A.  It  might  become  rotted. 


202 

Q.  The  fruit  if  not  in  good  condition  when  shipped  might  dete- 
riorate some?  A.  I  have  no  doubt  in  the  world  but  what  it  might 
under  some  circumstances,  or  there  might  be  an  accident  upon  the 
road,  in  which  it  might  be  delayed. 

Q.  Is  that  any  reason  why  a  bond  should  be  required  in  the  ship- 
ment of  green  fruit?  A.  Not  if  it  was  shipped  by  a  responsible 
person. 

Q.  Do  you  think  that  a  railroad  company  should  take  a  bond  from 
one  party  and  be  allowed  to  discriminate,  and  not  take  a  bond  from 
another?  A.  I  think  that  the  better  way  would  be  to  make  some 
rule  for  everybody. 

Q.  There  are  business  reasons  why  a  bond  should  be  required  in 
cases  of  shipment  of  green  fruit?     A.  I  don't  object  to  that. 

Q,  Is  it  your  judgment  that  there  should  be  any  discrimination  in 
the  prices  charged  for  different  kinds  or  classes  of  freight?  A.  Not 
to  the  extent  it  goes  now. 

Q,  In  your  judgment,  ought  there  to  be  any?  A.  I  think  there 
might  be  some  discrimination  under  the  maximum  the  State  should 
establish ;  but  there  should  be  classification,  and  similar  kinds  of 
material  should  all  be  put  into  one  class  and  at  one  rate.  All  agri- 
cultural product  might  be  put  into  one  class  and  at  one  price  ;  live 
stock  could  be  put  in  one  class  and  at  one  rate;  hardware  in  one 
class  and  at  one  rate.  I  should  adopt  the  rule  that  the  weight  or 
measurement  and  the  distance  per  mile  should  determine  the  amount 
of  fare  or  freight,  with  no  discriminations  for  persons  or  places 
Limit  the  amount  you  will  allow  the  company  to  retain  of  the  gross 
receipts — turn  the  remainder  into  the  State  Treasury,  and  the  com- 
pany will  no  longer  desire  any  discriminations,  special  contracts,  or 
rebates,  and  will  willingly  make  none  of  these ;  for  their  business 
would  be  vastly  simplified,  both  to  themselves  and  the  shipper. 

Q.  You  think  that  in  the  fixing  of  rates  both  the  shipper  and  the 
carrier  ought  to  be  consulted  ?  A.  I  think  it  should  be  done  in  that 
way.  In  all  other  cases  there  is  a  payer  and  a  payee,  and  the  agree- 
ment is  made  between  the  parties. 

Q.  Do  you  believe  that  would  be  the  best  system  which  made  a 
uniform  rate  for  freights  of  all  kinds?  A.  With  only  a  very  few 
classifications. 

Q.  You  think  there  should  be  some  classifications,  and  the  rate 
should  in  some  degree  depend  upon  the  classification?  A.  There  is 
another  point  to  take  into  consideration,  and  that  is  that  they  carry 
goods  in  botli  directions.  'If  cars  go  east  they  have  got  to  come  west, 
and  goods  go  in  both  directions,  therefore  a  less  rate  with  increased 
traffic.  Another  reason  is,  that  as  your  rates  decrease,  your  busi- 
ness increases,  and  your  whole  community  increases,  so  that  we  all 
are  encouraged  by  it. 

Q.  Then  there  are  circumstances  under  which  a  railroad  company 
ought  to  be  encouraged  in  charging  lower  rates  in  one  direction  than 
in  another?  A.  I  do;  and  I  think  that  this  morning  I  gave  the 
results  of  a  twelve  months'  experience,  terminating  on  the  thirtieth 
of  June  last,  referring  to  the  transportation  of  the  wheat  crop  from 
the  Western  States  to  the  seaboard,  showing  that  the  average  freight 


203 

was  but  twenty-seven  one  hundredths  of  a  cent  per  ton  per  mile, 
and  for  the  whole  freight  carried  it  was  but  one  and  two  fifths  cents 
per  ton  per  mile,  whilst  we  find  that  on  the  New  York  Central,  the 
average  was  only  sixty-seven  one  hundredths. 

Q.  Isn't  it  seventy-nine  one  hundredths?  A.  No,  it  is  sixty-seven 
one  hundredths.  The  eastern  roads  drew  their  earnings  from  a  pop- 
ulation of  fourteen  millions,  whilst  ours,  from  a  population  of  eight 
hundred  thousand,  carried  only  one  third  the  amount  of  freight  and 
received  fifty  per  cent  more  money  than  the  eastern  roads. 

Q.  In  the"  localities  of  which  you  speak  in  the  East  there  are  a 
large  number  of  roads?     A.  Yes,  sir. 

Q.  Is  not  that  the  aggregate,  then  ?  The  proportion  between  the 
West  and  the  East  is  very  different?  A.  We  carry  much  more  wheat 
than  any  other  road  in  the  United  States. 

Q.  Do  you  know  any  eastern  road  which  has  to  incur  the  expense 
of  maintaining  miles  of  snowsheds?  A.  No,  I  do  not;  but  then, 
there  is  another  question  we  don't  take  into  consideration,  that  the 
East  is  an  exceedingly  cold  country,  and  ice  and  frost  require  a  large 
expenditure,  both  in  making  the  road  and  in  the  repairs  thereafter. 

Q.  Are  not  wages  of  employes  on  railroads  in  California — on  the 
Central  Pacific  Railroad — very  much  higher  than  in  the  East?  A.  I 
can't  tell  you  precisely  ;  probably  they  are  fifteen  or  twenty  per  cent. 

Q.  Isn't  it  about  double?  A.  I  don't  think  it  is  a  great  deal  more  ; 
the  most  of  the  labor  that  they  have  is  clone  by  Chinamen,  and  he 
labors  at  about  seventy-five  cents  a  day  and  boards  himself;  I  do  not 
think  it  is  much  greater,  if  not  less. 

Q.  Were  you  correct  in  stating  that  a  majority  of  the  labor  is  per- 
formed by  Chinese  on  the  Central  Pacific  Railroad?  A.  I  asked  Mr. 
Wright,  the  Superintendent  of  six  or  seven  roads  in  this  State,  and  he 
told  me  there  were  seven  thousand  people  on  his  payrolls;  that  the 
average  to  the  mile  was  six  or  eight;  on  the  three  thousand  miles  of 
road  there  are  twenty  thousand  people  in  the  service,  the  most  of 
whom  are  on  the  tracks. 

Q.  Could  you  give  us  some  idea  of  the  relative  expense  of  the  Cen- 
tral Pacific  Railroad  Company,  as  compared  with  some  of  those  in 
the  East  of  which  you  speak?     A.  I  have  not  the  statistics  with  me. 

Q.  Isn't  there  a  greater  difference  in  the  cost  of  wages  than  there 
is  in  the  price  of  freights?  A.  There  is  another  view  of  the  subject, 
which  I  think  would  meet  what  you  are  looking  after,  and  which,  I 
think,  is  far  more  satisfactory;  take  the  gross  receipts  and  the 
gross  expenditures,  and  you  will  find  the  difference  vastly  in  favor  of 
the  California  companies.  The  expenses  of  the  road  here  amount  to 
about  twelve  million  dollars,  whilst  the  receipts  are  nearly  double  as 
much,  of  which  the  company  receive  ten  millions  more  than  they 
are  legally  entitled  to.  On  the  other  side  they  divide  three  or  four 
millions  and  are  satisfied  with  it. 

Q.  Do  you  know  a  line  of  those  roads  called  the  Northwestern? 
A.  I  know  something  about  it.  If  you  refer  to  Poor's  Manual,  you 
will  find  the  receipts,  and  all  these  matters. 

Q.  Does  it  not  vary  more  than  a  million  or  two  of  dollars  in  a 
season?  A.  I  could  not  tell  you.  I  have  been  so  much  occupied  in 
other  directions  that  I  have  lost  the  run  of  them. 


204 

0,.  I  will  ask  you  whether,  in  comparing  rates  between  the  eastern 
roads  and  the  Central  Pacific  Railroad,  you  have  taken  into  consid- 
eration in  your  estimates  the  difference  in  wages?  A.  I  have  taken 
the  whole  thing  into  consideration  in  taking  the  results,  and  I  know 
that  they  must  charge  a  great  deal  more  than  they  are  entitled  to, 
because  you  have  taken  the  gross  receipts  and  the  gross  expenditures, 
and  you  find  that  they  are  all  larger  than  they  should  be. 

Q.  Do  you  know  anything  about  the  relative  cost  of  coal  on  the 
eastern  roads  and  on  the  Central  Pacific  Railroad  ?     A.  No,  I  do  not. 

Q.  Do  you  know  whether  there  is  a  difference  or  not?  A.  I  pre- 
sume there  is  some  difference. 

Q.  Have  you  taken  that  difference  into  consideration  in  figuring 
the  relative  cost,  and  what  would  be  a  reasonable  rate  of  freights? 
A.  I  have  taken  the  other  view  of  the  subject.  You  should  take  the 
gross  receipts  and  the  gross  expenditures,  and  by  that  means  you  can 
get  at  it,  and  that  is  a  more  comprehensive  view  of  the  subject. 

Q.  But  you  have  not  gone  into  the  details,  I  understand  ?  A.  I 
have  by  the  other  calculation. 

Q.  Do  you  know  what  the  greatest  elevation  is  in  transporting 
wheat  from  St.  Louis  to  the  seaboard  ?    A.  No,  sir. 

Q.  Have  you  taken  into  consideration  the  fact  that  the  Central 
Pacific  Railroad  drag  freights  up  steep  grades,  greater  than  those 
on  the  eastern  roads?  A.  Yes,  sir;  but  for  the  same  reason,  if  you 
take  a  train  up  a  grade,  it  has  to  come  down  when  it  comes  back. 
These  are  circumstances  you  do  not  find  in  the  railroad  accounts. 
Besides  the  up  grades  are  eastward,  and  the  west  grades  are  descend- 
ing, and  two  thirds  of  the  freight  carried  in  California  descends  to 
San  Francisco.  And  then,  in  relation  to  the  matter,  there  are  no 
more  employes  or  engines,  and  the  only  circumstance  would  be  that 
they  would  consume  more  coal,  more  power — and  that  is  produced 
by  the  coal. 

Q.  Have  you  taken  into  consideration  the  wear  and  tear  of  rolling 
stock  in  going  up  and  down  heavy  grades?  A.  Yes,  sir;  that  is  in. 
I  will  tell  you  a  circumstance  in  connection  with  your  friend,  Hun- 
tington, a  little  while  ago. 

Q.  Mr.  Huntington  is  not  my  friend ;  I  have  never  seen  the  gen- 
tleman ?    A.  I  beg  your  pardon. 

Q.  I  should  be  glad  to  have  his  friendship,  or  that  of  any  other 
person,  if  I  could  have  it.  A.  Well,  he  and  I  were  sitting  together, 
talking  about  various  subjects,  and  I  thought  I  would  get  a  point 
from  him,  and  I  said  to  him  :  "Huntington,  one  of  the  most  extra- 
ordinary inventions  that  has  ever  been  made  was  this  matter  of 
making  the  steel  rail.  It  has  only  been  in  use  eight  or  ten  years ; 
what  has  been  your  experience  in  relation  to  the  matter?"  "Our 
experience  has  been,  that  where  our  rails  were  wearing  out,  and  the 
whole  rail  destroyed  in  six  or  seven  years,  the  steel  rail  does  not  wear 
out  at  all.  The  other  rails  used  to  put  us  to  from  nine  to  fifteen 
thousand  dollars'  expense  per  mile  once  in  every  six  years,  and  now 
we  find  that  they  are  the  best  rail  in  the  world ;  there  is  no  apparent 
wear  upon  the  rail."  So  there  was  a  proposition  brought  in  which 
works  a  material  advantage,  but  only  to  the  advantage  of  the  railroad 
company. 


205 

Q.  Upon  the  eastern  roads  how  many  loaded  cars  will  an  engine 
haul?  A.  That  goes  into  the  matter  of  the  power  of  the  engine — the 
character  of  the  road. 

Q.  I  am  speaking  of  the  ordinary  freight  engine?  A.  It  is  a  mat- 
ter of  grade  altogether.  I  think  you  are  going  in  the  wrong  direc- 
tion, and  I  will  tell  you  why. 

Q.  I  would  be  glad  to  be  straightened  out.  A.  You  have  been  over 
the  road  ? 

Q.  I  have  traveled  some.  A.  And  you  know  that  when  you  get 
on  the  other  side  of  the  mountains,  all  along  in  that  section  that 
comes  up  from  the  east,  that  it  runs  for  hundreds  of  miles  over  a 
country  that  is  level.  Then  you  come  on  to  the  mountains.  There 
you  have  rough  work,  but  it  does  not  begin  to  be  as  rough  as  you 
have  in  Pennsylvania.  In  this  State  you  can  go  in  the  San  Joaquin 
Valley  for  four  hundred  miles  without  grade,  and  over  the  most 
favorable  country;  and  as  you  come  up  from  San  Francisco  there  is 
no  grade  till  you  go  beyond  Sacramento.  Now,  if  you  take  the  whole 
level  road  in  connection  with  the  other,  you  have  more  favorable 
country  for  a  road  than  you  have  in  Pennsylvania. 

Q.  Have  you  any  idea  how  many  loaded  cars  an  engine  will  draw 
in  ordinary  work  in  the  State  of  New  York?    A.  I  have  not. 

Q.  One  engine  will  draw  forty  loaded  cars?  A.  I  have  seen  an 
engine  draw  a  great  many  cars,  but  it  was  under  peculiar  circum- 
stances— simply  to  carry  empty  ones  back. 

Q.  Every  engine  has  got  to  go  up  to  cross  the  mountains?  A.  Yes, 
sir. 

Q.  Do  you  know  that  starting  from  Rocklin  and  going  on  up  over 
the  mountains,  that  it  requires  two  triple  driving  wheel  engines  to 
drag  a  train  of  fourteen  cars?  A.  When  I  was  an  engineer  a  good 
while  ago,  they  did  not  allow  any  grade  on  a  road  of  over  sixty  feet  to 
the  mile.  Now,  if  the  grade  is  increased  to  one  hundred  and  sixteen 
feet  to  the  mile,  it  requires  a  heavier  power  to  go  up,  as  a  matter  of 
course,  but  the  power  of  engines  has  also  been  correspondingly  in- 
creased. 

Q.  What  figures  do  you  put  as  the  basis  of  profits  for  the  California 
roads?  I  understood  you  to  state  it  at  forty  millions.  Now,  in  ad- 
dition to  that,  I  ask  you  whether  those  values  were  estimated  in  this 
State  in  proportion  to  the  entire  value  of  the  road  or  to  the  assessed 
value?  A.  They  were  made  upon  the  basis  applied  in  making  this 
value  of  other  roads. 

Q.  Can  you  give  us  some  idea  of  the  proportion  of  the  entire  value 
of  the  road,  and  of  the  assessed  value?  A.  The  company  claimed 
in  my  county  seven  thousand  dollars  as  a  proper  assessment  per 
mile. 

Q.  Give  me  an  answer  to  the  questions  as  near  as  you  can?  A.  I 
was  called  to  testify  what  it  cost  in  the  case  which  was  brought  before 
the  Board  of  Equalization. 

Q.  I  would  like  to  know  some  of  these  things.  I  live  in  an  ob- 
scure country  locality,  and  am  not  informed  of  all  these  matters,  and 
I  am  trying  to  get  information?  A.  I  will  give  you  a  great  deal  of 
credit  for  practical  intelligence,  though  you  may  live  in  an  obscure 
country  locality. 


206 

Q.  Thank  you  for  your  compliment,  but  now  what  do  you  think 
was  the  difference  between  the  assessed  value  and  the  real?  A..  I 
will  refer  you  to  your  friend  Crocker. 

Q,  I  am  not  acquainted  with  Mr.  Crocker?  A.  He  swore,  on  one 
occasion,  that  it  was  one  hundred  and  seventy-eight  thousand  dollars 
per  mile,  and  on  another  occasion  that  it  was  sixteen  thousand 
dollars.  Here  you  have  the  assessment  on  one  side  and  the  real  on 
the  other,  I  suppose. 

Q.  I  do  not  propose  to  act  on  any  such  statement,  if  I  can  get  more 
reliable  information.  Can  you  not  give  us  more  reliable  informa- 
tion? A.  I  don't  know  where  you  could  look  for  more  reliable  infor- 
mation, except  in  the  office  of  the  company. 

Q.  You  have  been  an  engineer  and  ^ou  understand  these  questions. 
Could  you  give  us  some  idea?  A.  If  you  will  take  the  reports  you 
will  find  that  they  make  it  about  sixty  thousand  dollars  a  mile,  but 
I  think  that  that  represents  the  capital  after  they  have  watered  it  up. 
The  probability  is  that  the  road  cost  about  'thirty  or  fortj^  thousand 
dollars  a  mile. 

Q.  Do  you  think  that  would  be  a  fair  estimate  for  assessment? 
A.  I  saw  not  long  ago  an  assessment  of  a  railroad  in  Illinois  that 
was  assessed  at  thirty-six  thousand  dollars  a  mile. 

Q.  Those  roads  do  not  cost  as  much  as  the  California  roads?  A. 
More. 

Q.  How  do  you  get  at  that?  A.  Don't  forget  that  three  fourths  of 
the  roads  in  California  are  over  level  grades  and  are  cheaply  made. 
Do  you  know  a  Mr.  Gray?  He  was  the  Chief  Engineer  on  this  road 
for  a  time.  I  met  him  at  Salt  Lake,  when  the  road  was  under  con- 
struction, on  the  other  side  of  the  mountains,  where  it  goes  for 
hundreds  of  miles  on  an  even  grade,  and  he  said  that  much  of  it 
ought  to  be  made  at  a  cost  of  from  twelve  to  eighteen  thousand 
dollars  a  mile. 

Q.  That  was  the  grading?  A.  No,  sir;  that  was  the  cost  of  the 
road. 

Q.  Do  you  mean  on  the  slope  included  in  the  Union  Pacific  and 
the  Central  Pacific?  A.  I  mean  all  the  level  line  and  up  to  the  foot 
of  the  mountains  there  is  little  or  no  grade. 

Q.  Where  was  this;  on  the  Union  "Pacific  Railroad  or  on  the 
other?     A.  This  was  on  the  Central  Pacific. 

Q.  I  was  speaking  about  the  Central  Pacific?  A.  Yes,  sir.  The 
most  expensive  mile  of  road  that  they  had  to  make  was  at  Cape  Plorn, 
and  that  mile  cost  them  one  hundred  thousand  dollars. 

Q.  Including  the  high  trestle?  A.  Yes,  sir;  that  was  noted  as  the 
Cape  Horn  mile. 

Q.  Have  you  any  idea  of  what  a  mile  of  road  costs  in  the  Sierra 
Nevadas?  A.  That  was  the  most  expensive;  they  had  never  any- 
thing like  it. 

Q.  There  never  was  anything  as  difficult  in  all  the  history  of  rail- 
roading? A.  One  of  the  most  extraordinary  things  in  the  world  that 
ever  occurred  was  on  the  road  below  here — you  all  know  about  it. 
They  found  a  hole  there  in  the  road.  They  had  been  running  right 
along,  year  after  year,  and  one  night,  between  daylight  and  sunrise, 


207 

the  whole  thing  went  in,  and  they  put  a  force  on  and  went  to  filling 
it  up.  They  put  in  piles  and  brought,  not  carloads,  but  hundreds  of 
trains  of  cars,  and  dumped  the  gravel  in,  but  they  could  not  fill  it. 
Then  they  tried  to  pile  it,  but  they  couldn't,  so  they  gave  it  up. 

Q.  Taking  into  consideration  the  reasonable  value  of  the  construc- 
tion of  such  a  road  as  that  in  California,  isn't  the  percentage  of  profits 
less  than  on  some  of  the  eastern  roads  of  which  you  have  been  speak- 
ing?   A.  No,  sir. 

Q.  Have  you  examined  the  official  reports  to  determine  that  mat- 
ter? A.  I  have  examined  so  far  as  I  desired  to  make  the  comparison 
of  the  receipts  and  expenditures.  Then  we  must  take  into  consider- 
ation the  fact  that  this  road  runs  through  a  population  of  seven  or 
eight  hundred  thousand,  while  the  eastern  road  runs  through  a  pop- 
ulation of  fourteen  millions. 

Q.  Other  roads  are  running  parallel  with  it  at  short  distances? 
A.  Yes,  sir. 

Q.  So  that  would  speak  of  the  rate  it  would  bear  to  the  whole  pop- 
ulation? A.  The  profits  depend  upon  the  entire  receipts;  it  repre- 
sents the  difference  between  the  receipts  and  the  expenditures. 

Q.  Have  you  any  idea  of  the  number  of  miles  of  railroad  in  Cali- 
fornia?    A.  About  four  thousand. 

Q.  Have  you  any  idea  of  the  number  of  miles  in  the  State  of 
Illinois?    A.  Something  like  three  times  as  many. 

Q.  Have  you  any  idea  of  the  population?  A.  About  four  or  five 
millions. 

Q.  Have  you  any  idea  of  the  relative  profits  of  the  railroad  busi- 
ness in  Illinois  in  a  population  of  four  millions,  and  in  California 
with  a  population  of  eight  hundred  thousand?  A.  I  suppose  there 
is  no  railroad  in  the  world  that  receives  so  much  money,  in  propor- 
tion to  the  population,  as  the  Central  Pacific  Railroad. 

Q.  The  Northwestern  at  Chicago  receives  two  millions  more  than 
the  Central  Pacific?     A.  I  think  they  receive  less. 

Q.  Do  you  know  anything  about  the  Chicago,  Burlington,  and 
Quincy  road?  A.  I  do  not  know  much  about  that  country,  because 
I  have  been  living  in  California.' 

Q.  Do  you  know  anything  about  the  receipts  of  the  Pennsylvania 
Central  system?     A.  Only  from  the  reports. 

Q.  Or  of  the  Pennsylvania  Central  combination?  A.  I  had  a 
comparison  (I  cannot  lay  my  hand  upon  the  paper),  and  a  very  sat- 
isfactory one. 

Q,  I  will  waive  the  question.  You  said  something  about  the  paper 
manufactory?  At  what  points  were  those  you  spoke  of  ?  A.  One  in 
Santa  Cruz  County,  and  one  in  San  Jose. 

Q.  How  do  you  say  they  were  broken  down?  A.  By  putting  a 
very  low  price  on  paper  brought  from  New  York,  and  by  a  combina- 
tion by  which  an  extra  price  was  put  upon  wood  pulp,  and  a  low 
price  upon  rags,  by  which  they  could  ship  them  to  New  York.  The 
paper  and  pulp  came  in  this  direction,  and  the  rags  went  in  the  other. 

Q.  Do  you  think  the  low  prices  upon  freights  from  the  East  here 
would  tend  to  injure  the  manufactories  of  this  State?  A.  Unques- 
tionably. 


208 

Q.  Do  you  think  that  would  be  worth  taking  into  consideration  ? 
A.  Certainly. 

Q.  Which  disburses  in  the  State  the  more  moneys,  the  freight 
carried  by  rail  or  by  sea?  A.  The  disbursements  made  by  sea  are 
merely  at  the  seaboard.  Any  disbursements  made  by  the  railroad 
shipper,  of  course,  would  remain  in  the  State.  I  should  suppose 
there  would  be  more  disbursed  by  rail. 

Q.  Is  not  the  disbursement  a  benefit  to  all  the  people  of  the  State? 
A.  Yes,  sir. 

Q.  Could  you  give  any  method  by  which  we  could  ascertain  the 
value  of  railroad  property  in  this  State?  A,  I  don't  know  any  better 
way  than  to  elect  some  Railroad  Commissioners  who  would  devote 
themselves  to  the  interests  of  the  people,  and  allow  them  to  make  a 
reasonable  estimate. 

Q.  Do  you  think  that  they  would  be  able  to  do  so?  A.  I  would 
lay  down  a  mile  of  track  as  a  basis,  and  take  everything  connected 
with  it — add  to  that  the  extra  for  grading  the  road,  and  I  believe 
that  any  competent  engineer  would  get  at  it,  and  go  over  the  whole 
road  and  make  up  the  estimate  from  that  as  a  basis. 

Q.  Do  you  think  that  the  value  of  the  property  would  depend  in 
any  degree  upon  the  profits  realized?  A.  There  you  bring  up  a  sub- 
ject which  is  a  very  extraordinary  one,  because  you  cover  the  whole 
question  of  what  they  are  entitled  to  and  the  gross  receipts  and 
expenditures. 

Q.  In  fixing  the  profits  of  a  railroad,  or  any  other  corporation,  do 
you  think  it  would  be  proper  to  take  into  consideration  the  risks 
involved  in  the  investment  at  the  time  it  was  made?  A.  No ;  I  think 
the  risk  at  the  time  it  was  made  has  nothing  to  do  with  its  present 
value. 

Q.  I  am  speaking  of  the  reasonable  profits  ?  A.  I  stated  the  only 
connection  that  it  has  with  it. 

Q.  Supposing  that  one  business  enterprise  was  a  very  risky  one, 
and  that  another  was  a  very  certain  one — do  you  think  that  there 
should  be  any  difference  in  the  profits  allowed  to  the  one  investment 
over  the  other  if  the  profits  are  , to  be  controlled  by  law?  A.  The 
risk  should  be  taken  into  consideration,  but  as  far  as  the  railroad  is 
concerned  I  don't  think  they  have  taken  any,  or  that  it  should  be 
taken  into  account. 

Q.  I  am  speaking  of  the  risks  of  an  ordinary  undertaking?  A.  I 
don't  see  that  there  is  any  extraordinary  risk  taken  by  the  company. 

Q.  There  is  not  now,  but  you  know  that  when  the  Central  Pacific 
Railroad  was  constructed  there  was  a  question  as  to  whether  it  would 
pay  interest  on  the  investment?  A.  You  are  working  into  a  very 
extraordinary  history.  Don't  you  remember  that  Gorham  said  that 
it  took  eleven  thousand  five  hundred  dollars,  that  they  had  to  take 
out  of  their  pockets,  to  construct  theroad.  That  is  all  they  put  in 
for  all  the  dividends  that  they  ever  took  out. 

Q.  Do  you  believe  that  there  is  any  connection  between  the  risk 
taken  in  an  ordinary  business  enterprise  and  the  profits  that  should 
be  reasonably  allowed?  A.  That  risk  was  taken  twenty  years  ago. 
I  would  take  the  whole  bearing  upon  the  subject  in  every  way  in 
which  money  is  concerned. 


209 

• 

Q.  Do  you  believe  that  there  are  any  engineers  in  the  State  who 
could  go  before  the  Commission  and  form  a  reasonable  estimate  of 
the  value  of  the  railroads  in  the  State?  A.  I  do.  They  make  those 
statements  every  day.  The  engineer!  know  the  cost  of  everything  that 
goes  to  make  up  a  mile  of  road.  Hundreds  of  miles  of  grading  on 
these  roads  do  not  cost  three  hundred  dollars  per  mile.  After  you 
get  the  grading  done,  and  there  is  very  little  to  do,  except  in  a  moun- 
tainous country  (where,  of  course,  you  have  heavy  expenses),  the 
making  of  a  mile  of  road  is,  according  to  the  best  rates,  very  light. 
The  engineer  understands  the  cost  of  each  tie  and  the  number  of 
ties  and  rails  necessary,  and  the  cost  of  putting  it  together.  Take  a 
mile  of  road,  then,  at  Oakland,  for  instance,  as  a  basis,  and  add  the 
cost  for  transferring  the  material  as  the  road  extends,  include  the 
cost  of  grading,  and  then  multiply  by  the  number  of  miles,  and  you 
have  got  it. 

Q.  Have  you  any  idea  of  how  many  miles  of  tunnel  there  are  on 
the  Central  Pacific  Railroad  in  the  Sierra  Nevadas,  between  Sacra- 
mento and  Reno?     A.  No,  sir. 

Q.  Have  you  any  idea  of  how  many  tunnels  there  are?    A.  No,  sir. 

Q.  Have  you  any  idea  of  the  cost  of  excavating  those  tunnels? 
A.  It  depends  a  great  deal  upon  the  amount  of  material  in  them.  If 
you  go  to  the  reports  upon  the  subject  you  will  get  the  results. 

Q.  Do  you  think  that  a  mile  of  roadbed  at  Oakland  would  be  a 
correct  basis  for  the  estimate  of  the  running  of  a  mile  of  tunnel 
through  solid  rock?  A.  That  is  probably  another  proposition.  I 
brought  that  in  under  the  cost  of  the  construction  of  a  single  mile  of 
road  as  a  basis,  because  you  would  add  the  extra  cost  of  all  that  char- 
acter of  work. 

Q.  Have  you  any  idea  of  what  the  cost  is  of  a  mile  of  tunnel  in 
the  Sierra  Nevadas?  A.  I  know  that  the  tunnels  are  a  very  expen- 
sive matter,  but  at  the  same  time  a  matter  of  a  few  miles,  compared 
with  the  whole  cost. 

Q.  Do  you  know  anything  about  the  cost  of  running  a  tunnel  for 
ordinary  mining  purposes,  as  compared  with  the  cost  of  running  a 
large  railroad  tunnel?  A.  The  cost  would  not  be  in  proportion  to 
the  section  by  any  means: 

Q.  You  think  there  would  be  some  difference?  A.  There  would 
be  some,  but  it  would  be  in  favor  of  the  larger  one. 

Q.  You  do  not  mean  to  say  that  it  would  cost  more  to  construct 
the  smaller  tunnel  than  the  larger  one?  A.  No,  sir;  but  all  that  is 
a  matter  of  detail.  You  have  got  that  all  included  in  the  cost  of  the 
original,  the  forty  millions.  I  take  that  from  the  estimates  of  the 
engineers. 

Q.  Supposing  that  a  mile  of  such  tunnel  as  the  North  Bloomfield 
Mining  Company  made  in  their  mine  should  cost  upwards  of  a  mil- 
lion of  dollars,  would  that,  in  your  judgment,  be  a  fair  basis  from 
which  to  judge  of  the  cost  of  a  tunnel  for  a  railroad  in  the  Sierra 
Nevada  Mountains,  being  in  the  same  formation?  A.  Excuse  me, 
if  I  do  not  confine  myself  to  these  categorical  questions. 

Q.  You  are  only  requested  to  answer  the  question  in  your  own  way ; 
anything  that  answers  it,  is  all  that  I  care  for?     A.  If  you  take  the 

14 fc 


210 

reports  and  find  that  this  forty  millions  covers  the  whole  cost,  I 
do  not  see  any  need  of  going  into  all  this  detail.  It  does  not  give 
any  result  or  any  information  to  you  or  to  any  one  else. 

Q.  I  think  that  it  gives  me  information.  Have  you  any  idea  of 
where  the  trestles  are  on  the  Central  Pacific  Railroad?  A.  The 
highest  are  at  Cape  Horn. 

Q.  You  do  not  know  whether  they  have  filled  in  all  the  places 
above  Newcastle?    A.  No,  sir. 

Q.  Have  you  any  idea  of  how  much  that  has  cost  per  mile?  A.  It 
is  a  matter  I  have  not  kept  in  mind. 

Q.  Have  you  any  idea  of  what  the  additional  cost  would  be  to  the 
building  of  a  mile  of  road  in  Oakland?  A.  The  reason  that  I  said 
that  I  would  take  a  mile  at  Oakland  was  that  the  road,  so  far  as  the 
mere  iron  and  wood  is  concerned,  would  be  the  same.  All  these 
other  matters  would  come  in  and  be  added  as  additional,  and  would 
make  the  difference  in  the  totals.  There  is  no  grading  at  all  at  Oak- 
land. There  are  places  there  that  the  grading  would  not  cost  fifty 
dollars  a  mile. 

Q.  They  would  have  to  cover  the  ties  with  gravel?    A.  Ballast. 

Q.  That  is,  part  of  the  roadbed  ?  A.  Yes,  sir ;  but  not  the  grading. 
It  is  put  on  for  the  purpose  of  stopping  the  dust  and  to  keep  the  ties 
in  place  at  the  same  time. 

Q.  You  spoke  about  "  watering"  railroad  stock;  do  you  know  that 
there  has  been  any  "watering"  in  the  State  of  California?  A.  I 
think  it  is  about  all  "water;"  it  is  like  a  man  owning  a  farm  worth 
five  thousand  dollars,  with  a  twenty  thousand  dollars  mortgage  on  it. 

Q.  Suppose  that  the  narrow-gauge  railroad  in  Nevada  and  Placer 
Counties  cost  five  hundred  and  ninety-eight  thousand  dollars  in  hard 
money,  and  that  none  of  it  whatever  was  a  subsidy,  would  you  call 
that  water?  A.  That  depends  upon  whether  there  are  any  mort- 
gages upon  it,  or  whether  that  is  the  value  of  the  stock. 

Q.  [Question  repeated.]     A.  No;  I  would  not. 

Q.  Would  you  think  that  there  was  any  water  about?  A.  Not  if 
it  was  honestly  appropriated  for  the  building  of  the  road. 

Q.  Supposing  that  in  the  construction  of  the  South  Pacific  Railroad 
there  was  about  four  millions  of  dollars  expended,  and  that  there 
was  no  subsidy  at  all  or  any  bonded  indebtedness  upon  the  road, 
would  you  say  that  was  water?  A.  Not  if  it  was  the  legitimate  cost 
of  the  road,  and  there  was  no  issuing  of  stock  afterwards  which  was 
watered.  I  was  merely  referring  to  the  manipulation  of  such  mat- 
ters. Gould,  when  he  found  himself  in  possession  of  a  line  of 
telegraph  stock  of  thirty-eight  millions  put  the  whole  at  eighty-two 
millions,  and  that  difference  represented  the  water. 

Q.  I  am  talking  about  the  watering  of  any  stock  issued  by  the 
railroads  of  California?  A.  Whenever  the  public  is  made  to  believe 
that  a  stock  is  worth  more  than  it  is,  that  stock  has  been  watered. 

Q.  That  is  what  you  meant  when -you  said  that  the  railroad  stock 
was  watered?  A.  I  don't  know  that  I  did.  I  know  that  the  railroad 
stock  was  watered. 

Q.  Do  you  think  that  the  fact  that  slabs  were  of  little  value  should 
be  taken  into  account  in  fixing  the  rate?    A.  That  is  not  what  I  was 


211 

referring  to.  I  think,  as  far  as  the  value  is  concerned,  you  will  find 
that  you  cannot  charge  one  man  more  than  another.  The  point  I 
wanted  to  make  was,  that  it  costs  to  transport  them  one  hundred 
and  twenty-three  miles  twenty-two  dollars,  and  when  I  ordered  a 
car  to  he  taken  seven  miles  further  they  charged  eleven  dollars. 

Q.  Do  you  think  that  the  fact  that  the  slabs  were  of  little  value 
should  be  taken  into  consideration  in  fixing  the  rate?  A.  There 
you  are  getting  into  the  same  difficulty.  It  involves  the  question  of 
classification,  and  I  think  that  there  should  not  be  more  than  four 
or  five  classifications.  But  if  you  are  going  to  allow  discrimination, 
■the  slabs  ought  to  be  put  in  at  the  smallest  value. 

Q.  Do  you  believe  that  there  should  be  any  difference  between  the 
transportation  of  the  poorest  and  best  quality  of  sugar-pine  lumber 
and  slabs?  A.  As  far  as  that  is  concerned,  I  think  tha(s»  the  people 
and  the  railroad  ought  to  agree  together  as  to  the  classifications. 
You  should  make  your  different  classifications,  and  then  piit  your 
different  items  in. 

Q.  I  wanted,  if  I  could,  being  young  and  green,  to  get  the  benefit 
of  your  experience  as  a  business  man,  as  to  whether  it  would  be  well 
for  the  Legislature  to  adopt  an  iron-bound  rule  that  such  things  as 
sugar-pine  lumber  should  be  charged  at  the  same  rate  per  ton  as 
slabs?  A.  There  is  no  reason  for  it.  You  should  make  but  very 
few  distinctions  between  one  thing  and  another. 

Q.  Would  you  make  as  many  as  a  dozen?  A.  It  would  be  no 
matter,  one  way  or  the  other. 

Q.  It  might  to  a  man  who  wanted  to  frame  a  law,  and  wanted  to 
get  the  best  judgment  and  experience  of  wise  men  ?  A.  I  do  not 
care  to  go  into  these  matters  of  detail. 

Q.  You  would  not  care  to  answer  that  question  any  more  directly  ? 
A.  No,  sir. 

Q.  Have  you  any  idea  of  what  proportion  of  the  freights  received 
by  the  Central  Pacific  Railroad  Company  come  from  the  citizens  of 
California?  A.  I  know  that  the  greater  portion  is  received  from  the 
citizens  of  California,  and  that  their  local  freight  outnumbers  largely 
the  amount  brought  from  the  States. 

Q.  Which  is  the  higher,  on  the  whole,  the  freight  on  imports  or 
the  freight  on  the  local  traffic,  including  the  farm  products?  A.  The 
local  freight. 

Q.  Isn't  it  a  fact  that  it  is  only  one  third  as  much  on  the  wheat 
crop?  A.  They  charge  two  and  a  quarter  cents  per  ton  per  mile,  and 
on  the  other  side  they  charge  twenty-seven  one  hundredths  of  one 
cent. 

Q.  How  many  years  ago  was  that  estimate  made?  A.  On  the  thir- 
tieth of  June  last. 

Q,  Do  you  know  whose  statement  that  was?    A.  No,  sir. 

Q.  The  information  that  you  have  was  that  it  was  two  and  a  quar- 
ter cents  per  ton  per  mile?     A.  Yes,  sir. 

Q.  Do  you  believe  that  the  railroad  company,  for  the  purpose  of 
building  up  an  industry  in  the  interior,  should  be  allowed  to  dis- 
criminate in  favor  of  that  industry?  A.  If  there  is  any  discrimina- 
tion it  ought  to  be  for  lawful  purposes,  and  a  reasonable  one,  and  not 


212 

one  by  which  they  can  be  permitted  to  break  clown  the  interests  and 
industries  of  the  country.  Now  the  eastern  merchant  gets  his  goods 
transported  into  the  towns  of  Los  Angeles  and  San  Jose  at  the  same 
rates  that  the  local  merchants  get  theirs.  There  isn't  any  discrimina- 
tion there,  but  it  is  certainly  wrong  and  against  the  interests  of  the 
vessels  coming  to  this  State,  and  against  the  merchants  of  San  Fran- 
cisco. Now,  isn't  that  a  most  extraordinary  thing;  how  do  you 
reconcile  it?  Now,  a  party  wanted  some  machinery  left  at  Virginia 
City,  and  made  a  contract  to  have  it  left  there  at  a  certain  time. 
They  telegraphed  to  know  why  the  machinery  was  not  delivered, 
and  the  first  thing  they  found  out  about  it  was  that  it  had  been  sent 
to  Oakland.  He  wanted  it  sent  back  to  him,  but  they  said  that 
they  couldn't  send  it  back  ;  it  had  to  be  sent  to  San  Francisco.  And 
that  machifliery  was  absolutely  taken  across  the  bay  and  then  sent  to 
Virginia  City. 

Q.  Do  you  know  it,  as  a  fact,  that  the  Central  Pacific  Railroad 
Company  has  made  such  rates  upon  heavy  machinery  as  has  enabled 
California  to  manufacture  and  ship  to  Nevada,  Idaho,  and  Utah  all 
the  heavy  machinery  used  for  mining  purposes,  at  less  rates  than 
they  can  be  procured  from  eastern  dealers  ?  A.  I  know  that  in 
transporting  heavy  mining  machinery  from  San  Francisco  to  those 
places,  it  ought  not  to  cost  as  much,  for  the  reason  that  they  are  five 
or  six  times  the  distance  from  those  places  as  San  Francisco. 

Q.  Do  you  know  that  the  railroad  company,  by  discriminating,  has 
enabled  the  California  foundries  to  manufacture  all  the  heavy 
machinery  used  in  mining  in  Utah,  Idaho,  and  other  States  on  this 
coast?  A.  I  do  not  see  where  the  railroad  company  are  entitled  to 
any  particular  credit  there.  It  certainly  is  less  distance,  and  then 
we  understand  the  making  of  mining  machinery  on  this  coast.  They 
have  not  had  our  experience  in  making  mining  machinery  in  New 
York.  We  have  more  ingenious  people  here,  and  we  understand  the 
requirements,  and  have  the  skilled  workmen.  New  York  has  no 
workmen  skilled  in  making  mining  machinery. 

Q.  Do  you  think  it  would  be  wise  to  allow  specially  low  rates  in 
order  to  maintain  a  sugar  factory  at  Alvarado  ?  A.  There  are  not 
more  than  ten  miles  of  country  there,  and  the  cost  of  transportation 
over  that  is  not  going  to  make  or  break  a  manufactory. 

Q.  Might  it  not?  A.  No;  it  could  be  hauled  by  teams  for  that 
distance.     I  understand  that  it  is  only  about  six  or  seven  miles. 

Q.  Have  you  any  idea  what  it  would  cost  to  haul  it  by  teams?  A. 
It  ought  to  be  about  half  a  cent  per  ton  per  mile  by  railroad. 

Q.  Mr.  Davis  testified  that  certain  parties  were  about  to  establish 
a  sugar  factory  at  Alvarado;  that  they  had  a  certain  amount  of  busi- 
ness already  upon  the  road;  that  he  could  transport  some  additional 
freights  at  a  very  low  rate,  and  that  he  would  give  that  company  a 
very  low  rate  in  order  that  they  might  manufacture  sugar  at  Alva- 
rado and  make  a  profit ;  that  if  he  was  to  charge  them  a  uniform  rate, 
it  could  not  be  done.  Do  you  think  that  for  .such  a  purpose  it  would 
be  reasonable  to  allow  a  lower  rate?  A.  I  think  that  a  reasonable 
distinction  in  these  matters  is  justifiable,  if  not  done  for  the  purpose 
of  annoyance. 


213 

Q.  Do  you  think  it  would  be  wise  to  pass  a  law  which  would  pre- 
vent all  discrimination?  A.  The  trouble  with  the  matter  is,  that  if 
you  are  going  into  discrimination  you  do  not  know  where  to  stop. 
There  should  be  no  distinction  between  one  man  and  another. 

Q.  Do  you  think  that  there  should  be  a  reasonable  distinction 
allowed?     A.  Not  between  individuals. 

Q.  Supposing  that  the  railroad  company  could  assist  the  manufac- 
ture of  paper  within  the  State  by  fixing  a  different  rate  of  freight,  do 
you  think  it  would  be  wise  to  allow  such  a  law  as  would  enable  them 
to  do  so?  A.  I  think  there  ought  to  be  no  objection,  providing  it 
were  done  for  an  honest  purpose,  and  then  the  people  of  California 
would  not  object  to  it.  The  people  are  largely  influenced  by  the 
press  of  the  State,  and  the  railroad  company  have  shown  their  influ- 
ence over  the  press  in  the  State. 

Q.  You  do  not  mean  the  Chronicle?  A.  I  refer  particularly  to  a 
little  paper  in  our  own  county,  and  they  do  attempt  to  influence 
some  of  the  papers,  and  own  some  of  the  big  papers  of  the  State,  and 
I  think  that  is  a  subject  of  more  importance  to  legislate  about  than 
the  carrying  of  freight  three  miles.  I  think  they  ought  to  be  made 
responsible  to  the  people  of  the  State.  The  people  want  redress;  they 
want  to  be  protected. 

Q.  Do  you  think  that  there  should  be  any  discrimination  shown  in 
favor  of  building  up  the  manufactories  of  the  State?  A.  I  think  the 
better  way  would  be  to  allow  it  to  none.  Then  they  would  have  a 
common  rule,  and  there  would  be  no  misunderstanding.  The  con- 
sumer has  to  pay  it  all  in  the  end. 

Q.'  The  rich  have  to  stand  their  share?  A.  The  merchant  does  not 
pay  for  any  of  these  things.  He  will  sell  his  goods  at  a  profit,  what- 
ever they  may  cost,  and  the  consumer  has  to  pay  for  it  all  in  the  end. 

Q.  Supposing  that  the  cost  of  transporting  by  rail  and  by  water 
were  approximately  the  same,  who  would  suffer  in  that  event?  A. 
It  would  not  make  any  difference  to  the  consumer;  he  has  to  pay  it; 
he  has  got  to  foot  the  bills. 

Q.  If  the  railroad  company  should  disburse  a  million  of  money  in 
the  State,  that  would  be  a  benefit  to  the  people  of  the  State?  A. 
"While  they  were  disbursing  more  or  less,  they  are  taking  from  the 
farmer  the  difference,  between  five  and  ten  millions,  from  his  wheat 
crop. 

Q.  Does  it  cost  any  more  to  navigate  the  high  seas  than  it  did 
before  the  railroad  was  built?  A.  A  short  time  ago  it  was  down  to 
nearly  two  pounds  on  account  of  some  corner  which  was  attempted 
and  which  failed,  but  I  think  that  all  of  our  freights  are  higher  now 
than  they  used  to  be.  For  the  last  five  years,  and  the  five  years  pre- 
ceding, I  have  not  been  paying  so  much  attention  to  the  relative  cost. 

Q.  Do  you  know  about  what  year  the  Central  Pacific  was  com- 
pleted?    A.  About  1869. 

Q.  Have  you  any  idea  of  what  the  tonnage  of  wheat  was  at  that 
time?     A.  We  did  not  have  much  wheat  at  that  time. 

Q.  Have  you  compared  the  rates  with  the  rates  on  wheat  for  the 
last  five  years?  A.  I  have  for  the  last  ten  or  twenty  years.  The 
point  is,  that  if  you  keep  the  ships  away  it  is  to  our  disadvantage. 


214 

Q.  Was  there  ever  a  time,  except  when  Friedlander  was  making  a 
corner,  that  vessels  could  not  be  chartered  at  San  Francisco  to  carry 
wheat  to  New  York?    A.  I  think  there  were  always  some  ships  here. 

Q,  Then  the  railroad  company  has  not  driven  off  all  the  shipping 
from  San  Francisco?  A.  I  cannot  tell  you  whether  there  are  few  or 
more.  I  do  not  know,  but  I  do  know  that  the  effect  naturally  must, 
be  that  when  they  are  deprived  of  the  freight  in  one  direction  they 
will  charge  more  in  the  other.  They  could  not  bring  freight  here 
satisfactorily  if  they  did  not  get  freight  the  other  way. 

Q.  Why  do  the  Central  Pacific  Railroad  make  freights  on  some 
goods  cheaper  than  they  do  on  others?  A.  In  order  to  put  freights 
up  after  they  have  driven  the  ships  off. 

Q.  Have  you  ever  seen  the  figures  showing  the  relative  value  of 
freight  brought  into  the  San  Francisco  market  during  the  last  few 
years  by  the  Central  Pacific  Railroad?     A.  No,  sir. 

Q.  Could  you  give  the  committee  any  idea  of  the  relative  increase 
in  the  value  of  the  imports  brought  into  San  Francisco  within  the 
last  few  years?    A.  No,  sir. 

P,.  You  stated  that  if  the  rates  of  freights  and  fares  were  lowered 
it  would  tend  to  increase  the  population  of  the  State?  A.  Certainly; 
I  recommended  that  all  rates  should  be  so  low  that  the  population 
would  be  increased. 

Q.  Any  system  which  would  tend  to  increase  the  population  of  the 
State  would  be  a  benefit  to  the  State?    A.  Of  course  it  would. 

A.  Isn't  it  a  fact  that  the  Central  Pacific  Railroad,  and  its  connect- 
ing lines,  have  increased  the  population  more  rapidly  than  it  ever 
increased  before?  A.  If  there  was  anything  I  was  disappointed 
about  it  is  the  fact  that  with  our  resources  the  development  of  Cali- 
fornia has  been  retarded  by  the  rates  charged.  AVe  should  have  had 
two  or  three  million  of  people  more  in  the  State  by  this  time. 

Q.  Would  it  cost  an  emigrant  any  more  to  go  from  New  York  to 
San  Francisco  by  water  before  the  Central  Pacific  Railroad  was  com- 
pleted than  it  does  now?  A.  They  should  have  come  a  great  deal 
cheaper. 

Q.  What  did  it  cost  to  come  by  way  of  the  Isthmus?  A.  There 
was  a  time  when  a  man  could  come  for  twenty  or  thirty  dollars. 

Q.  In  1864  and  1865?  A.  Everything  was  in  an  advanced  stage 
at  that  time.     They  were  willing  to  give  almost  anything  to  get  here. 

Q.  What  broke  that  down?  A.  The  giving  out  of  the  placer 
mines.  At  the  time  of  discovery  of  gold  I  came  out  here  with  the 
United  States  troops,  and  men  would  start  for  the  mines  and  take 
nothing  with  them  but  a  jack-knife,  and  they  would  come  back  with 
a  sack  containing  five  or  six  thousand  dollars  round  their  waists  in 
about  five  or  six  weeks. 

Q.  Was  it  one  of  the  main  causes  that  money  was  not  made  here 
as  easily  as  it  was  before?  A.  No ;  nobody  comes  here  now  with  that 
expectation. 

Q.  Do  you  know  what  it  cost  an  emigrant  to  go  from  New  York 
to  San  Francisco  before  the  Central  Pacific  Railroad  was  completed? 
A.  No,  sir. 

Q.  Wasn't  it  four  times  as  much  as  it  is  now?    A.  I  do  not  know. 


215 

I  don't  think  the  matter  of  a  railroad  is  going  to  bring  people  here; 
it  is  only  under  the  impulse  of  the  moving  spirit  that  they  desire  to 
come,  and  a  natural  desire  to  better  their  condition.  I  don't  think 
the  railroad  is  entitled  to  any  credit  on  that  score. 

Q.  What  is  the  cost  to  an  emigrant  from  New  York  to  San  Fran- 
cisco? A.  I  do  not  know  the  price  they  charge.  I  know  that  it  is  so 
great  that  a  great  many  of  them  have  told  me  that  the  prices  charged 
by  the  railroad  company  were  so  heavy  that  they  could  not  afford  to 
go  across  again. 

Q.  Do  you  know  of  any  place  in  the  world  where  a  passenger  can 
ride  three  hundred  miles  continuosly  for  the  same  price  ?  A.  Fares 
on  eastern  railroads  are  much  less  than  here. 

Q.  What  is  the  length  of  the  Central  Pacific  Railroad  from  here  to 
Ogden?    A.  Eight  hundred  miles. 

Q.  Eight  hundred  and  ninety-one?     A.  Call  it  nine  hundred. 

Q.  What  is  the  length  of  the  Union  Pacific  Railroad?  A.  The 
distance  to  New  York  is  three  thousand  miles.  I  think  the  charge 
ought  to  be  in  proportion  to  the  distance. 

Q.  Then  the  railroad  which  carries  one  train  a  day  should  charge 
the  same  rate  as  the  road  that  carries  four  trains?  A.  They  don't 
carry  men  in  this  instance.  But  the  whole  thing  depends  upon 
competition;  a  small  proportion  of  the  emigrants  come  to  this  place. 

Q.  How  many  people  travel  over  the  Union  Pacific  Railroad,  as 
compared  with  the  number  that  travel  over  the  Central  Pacific  line, 
do  you  think?  A.  That  has  nothing  to  do  with  it  in  the  world  ;  you 
may  think  so,  but  I  do  not. 

Q.  Does  not  the  Pennsylvania  Central  carry  ten  passengers  for 
every  one  that  is  carried  on  the  Central  Pacific?  A.  I  don't  know. 
The  whole  road  is  a  monopoly.  On  the  other  side  competition  limits 
it.  The  Central  Pacific  Railroad,  as  shown  by  the  reports,  ship  the 
less  number  of  people,  and  take  the  most  money. 

Q.  That  is  where  they  nail  the  Central  Pacific,  ain't  it?  A.  That 
is  where  the  Central  Pacific  nail  them. 

Q.  In  your  judgment,  the  road  which  carries  one  passenger  per 
day,  should  not  charge  any  more  than  the  road  which  carries  a  hun- 
dred? A.  I  do  not  think,  that  because  I  am  the  one  man,  they 
should  charge  me  a  hundred  times  as  much. 

Q.  It  would  require  the  same  investment  to  construct  a  road  to 
carry  one,  that  it  would  a  hundred  ?  A.  The  parties  who  started 
this  never  invested  but  eleven  thousand  five  hundred  dollars  of  their 
own  money. 

Q.  You  do  not  answer  my  question  ?  A.  I  do  not  think  you  are 
asking  questions  that  are  material. 

Q.  You  refuse  to  answer  that  question  ?  A.  For  the  simple  reason 
that  I  have  answered  it. 

Q.  Do  you  think  that  the  quantity  of  freight  transported  over  the 
road  should  have  anything  to  do  with  the  charges?  A.  I  think  so; 
I  think  that  the  whole  matter  should  be  determined  by  fixing  the 
amount  that  the  company  should  receive,  and  then  fix  the  prices  to 
make  that  amount.  It  would  he  the  matter  of  quantity  that  would 
largely  regulate  the  rate,  and  that  should  fix  the  sum  by  which  the 
railroad  should  be  worked. 


216 

Q.  Supposing  that  the  rates  to  this  State  should  be  reduced  one 
half,  would  it  in  two  years  increase  the  quantity  in  proportion?  A. 
You  could  not  get  at  the  proportion,  because,  while  it  would  not 
increase  the  quantity  on  some  classes  of  goods  materially,  it  would 
increase  it  on  others. 

Q.  What  proportion  of  our  land  is  planted  to  wheat?  A.  I  cannot 
tell. 

Q.  Are  the  places  where  it  is  planted  nearer  the  railroad  lines  or 
otherwise?  A.  The  probability  is  that  they  are  where  they  can 
transport  it. 

Q.  Supposing  that  groceries  were  decreased  in  price  two  thirds, 
would  it  have  a  material  effect  upon  the  consumption — would  it  be 
increased  ?    A.  That  is  a  question  of  whether  they  have  got  it  to  eat? 

Q.  If  people  have  it  they  eat  about  all  they  need?  A.  It  would 
be  surprising  if  they  didn't. 

Q.  Then,  the  lowering  of  freight  would  not  increase  the  amount 
imported?     A.  I  don't  know  that  it  would. 

Q.  Would  it  not  be  the  same  with  regard  to  hardware?  A.  I  sup- 
pose they  would  simply  bring  sufficient  to  supply  the  demand. 

Q.  What  class  of  freights  would  be  increased  in  this  State  by 
reducing  the  rate  on  them?  A.  The  lowering  of  the  freights  would 
be  a  lowering  of  the  money  going  into  the  pockets  of  the  railroad, 
and  the  people  would  be  benefited  by  having  it  left  in  their  own 
pockets. 

Q.  Then,  you  do  not  mean  to  say  that  the  lowering  of  freights 
would  thereby  increase  the  amount  imported?  A.  I  don't  think  it 
would,  for  the  simple  reason  that  we  don't  want  them  increased. 

Q.  Have  you  any  idea  of  the  population  of  the  State  for  the  five 
years  immediately  preceding  the  completion,  as  compared  with  the 
population  for  the  last  five  years?    A.  No,  sir. 

Q.  Do  you  know  whether  the  number  of  ships  in  the  harbor  of 
San  Francisco  has  approximately  kept  pace  with  the  increase  in  the 
population  in  the  State?  A.  I  do  not  think  that  has  any  relative  con- 
nection one  with  the  other.  1  don't  think  that  is  the  proposition  at 
all.    This  is  a  matter  of  carrying  goods. 

Q.  You  do  not  think  that  the  cost  of  transportation  has  anything 
to  do  with  the  number  who  come?     A.  I  do  not  think  that  it  has. 

Q.  Do  you  not  think  that  a  great  many  of  the  emigrants  who  come 
to  New  York  have  barely  money  enough  to  pay  the  cost  of  trans- 
portation to  San  Francisco?  A.  I  understand  that  a  great  many  of 
the  emigrants  now  have  a  good  deal  of  money  with  them. 

Q.  Is  that  your  idea  of  them  as  a  whole?  A.  I  speak  of  them  as 
a  whole.  There  is  a  class  of  emigrants  that  bring  a  great  deal  of 
money  with  them  to  the  United  States. 

Q.  Have  you  any  idea  as  to  whether  California  gets  its  quota  of 
immigrants  as  compared  to  the  other  States?  A.  I  know  it  does 
not. 

Q.  Do  you  know  whether  the  Chinese  immigration  has  had  any- 
thing to  do  with  that  result?  A.  There  is  some  prejudice  against 
the  Chinese;  I  know  that  Kansas  and  other  neighboring  States  have 
built  up  within  the  last  few  years,  while  we  still  have  only  about 


217 

eight  hundred  thousand  ;  while  they  have  got  three  times  as  many. 
Ldon't  see  that  the  Central  Pacific  Railroad  is  entitled  to  any  credit. 
We  are  more  than  five  times  as  large  as  some  of  these  States,  and 
capable  of  supporting  a  population  of  twenty  millions,  and  we  have 
only  about  eight  hundred  thousand.  I  don't  see  that  we  have  any- 
thing to  boast  of. 

Q.  Have  you  any  idea  of  the  relative  value  of  the  imports  to  the 
State  of  California  within  the  last  few  years,  as  compared  with  the 
years  just  preceding  the  completion  of  the  Central  Pacific  Railroad? 
A.  You  had  better  ask  these  questions  of  some  merchant  in  San 
Francisco. 

Senator  Whitney — It  has  been  stated  here  that  lumber  was 
brought  from  the  Santa  Cruz  Mountains  by  rail  for  four  dollars  a 
thousand ;  that  they  had  a  great  deal  more  than  they  could  sell,  and 
asked  Mr.  Davis  to  give  them  the  privilege  of  sending  it  to  Oakland 
at  an  additional  fifty  cents  per  thousand.  Do  you  think  that  is  a 
discrimination  which  is  wise  or  that  it  ought  to  be  prohibited  ?  A. 
I  think  in  all  these  cases,  that  if  the  motive  is  a  good  and  proper 
one,  that  should  determine  it.  Of  course  there  might  be  consequen- 
ces which  we  could  not  foresee. 

Q.  Do  you  think  a  law  would  be  wise  which  would  prevent  Mr. 
Davis  from  making  that  distinction?  A.  There  is  a  distinction 
which  may  be  proper,  provided  it  could  be  properly  and  honestly 
made,  and  from  correct  motives. 

Q.  Would  you  think  it  a  wise  law  which  would  forbid  such  dis- 
tinction? A.  Only  in  this  respect,  that  when  you  undertake  to  con- 
trol men  you  have  got  to  do  it  positively.  If  you  leave  a  loophole 
open,  they  are  certain  to  take  advantage  of  it. 

Q.  Do  you  think  that  a  law  preventing  all  discrimination  would 
be  wise  as  an  iron  rule  generally?  A.  I  think  so;  I  don't  see  how 
you  can  adopt  any  other  principle. 

Senator  Murphy — Do  you  believe  that  a  reduction  of  freight  and 
fares  by  rail  would  increase  the  quantity  of  shipping  by  water?  A. 
It  would  reduce  the  shipping  by  water,  because  the  greater  the  re- 
duction, the  more  would  go  by  rail. 

Q.  Then  a  reduction  in  rates  would  tend  to  drive  shipping  from 
the  high  seas?  A.  If  they  could  say,  "Your  ships  shall  not  come 
here,"  of  course  they  would  do  so,  and  then  they  could  increase  their 
rates  on  all  the  freights.     It  is  a  mere  matter  of  money. 

Senator  Brooks— The  wheat  that  is  shipped  out  of  this  State  goes 
to  Liverpool  mainly?     A.  Yes,  sir. 

Q.  Do  you  think  that  the  railroad  would  be  compelled  to  carry 
wheat  at  any  price  that  we  may  adopt  by  rule?  A.  They  could 
carry  it  in  the  State  as  cheaply  as  they  do  on  the  other  side,  twenty- 
seven  one  hundredths  of  a  cent;  that  would  be  to  New  York  seven 
dollars  and  fifty  cents,  and  then  they  would  have  other  freight  in 
this  direction. 

Q.  Do  you  think  it  would  be  possible  fpr  a  railroad  company  to 
move  five  hundred  thousand  tons  of  wheat  from  Sun  Francisco?  A. 
If  they  can't  it  would  be  necessary  to  send  it  by  vessels. 

Q.  Then  all  this  talk  about  driving  the  ships  from  the  sea  is  talk- 


218 

ing  about  something  that  they  cannot  do?  A.  Well,  I  spoke  of  the 
motive;  they  require  the  merchants  to  sign  a  contract  that  they  will 
not  trade  with  those  who  bring  these  goods  there,  so,  if  they  suc- 
ceeded or  not,  they  are  entitled  to  no  credit  for  what  they  have  done. 


Statement  of  Mr.  Barry. 

Mr.  Chairman  and  Gentlemen:  What  I  may  have  to  say  about 
this  bill  is  rather  in  the  nature  of  an  argument  than  otherwise,  be- 
cause I  had  expected  that  questions  might  be  asked  by  the  committee. 
The  object  of  the  bill  is  to  prevent  discrimination  on  the  part  of  rail- 
road corporations,  between  persons  or  places,  either  by  rebates  on  the 
part  of  the  railroad  companies,  or  in  any  other  manner,  and  to  fix 
uniform  rates  of  charges  between  places  in  the  transportation  of 
freight,  as  well  as  to  do  away  with  the  present  system  of  special  con- 
tracts, by  prescribing  a  system  by  which  the  railroad  companies  will 
remain  entirely  within  the  control  of  the  State.  I  take  it  as  a  fun- 
damental principle  that  in  its  regulation  of  the  railroad  corporations, 
the  State  must,  necessarily,  have  complete  control  over  them,  and, 
therefore,  the  passage  of  any  such  Acts  as  will  tend  to  this  object,  and 
to  prevent  the  abuses  of  the  present  system,  are  entirely  proper.  The 
State  has  the  right  to  prescribe  a  system  of  laws  for  the  control  of 
railroad  transportation,  and  as  corollary  to  that  it  may  enact  laws 
for  the  government  of  railroad  companies  and  corporations,  that 
will  prevent  the  adoption  by  them  of  rules  of  discrimination,  such 
as  the  present  special  contract  system.  The  bill  being  framed  upon 
that  basis,  or  with  a  view  to  those  ideas,  and  for  the  purpose  of  pre- 
venting discrimination,  it  is  made  general  in  its  terms,  that  all  rail- 
roads built  or  owned  by  corporations  organized  under  the  laws  of 
this  State  are  public  highways. 

In  regard  to  that,  I  would  say  that  it  is  not  proper  to  approach  this 
subject  with  the  view  that  railroads  are  simply  common  carriers, 
because  they  are  subject  to  legislative  control,  differing  from  other 
classes  of  common  carriers  who  are  not  subject  to  the  same  control, 
where  the  same  reason  does  not  arise.  The  railroad  is  controlled  in 
its  use  as  a  public  highway,  just  as  a  toll  road  owner  collecting  tolls 
is  subject  to  the  control  of  the  Boards  of  Supervisors  in  whatever  he 
does  in  reference  to  those  roads.  A  common  carrier  who  is  a  public 
agent,  using  a  public  highway,  or  a  corporation  of  like  character,  is 
to  be  regulated  and  controlled  because  it  is  such  agent.  Therefore, 
I  think  that  it  should  be  laid  down  as  a  leading  proposition,  and  a 
fundamental  principle,  that  railroad  corporations  are  not  to  be  con- 
sidered simply  as  common'  carriers,  but  as  public  agents,  using  the 
public  highway.  Then,  as  a  natural  consequence,  "all  roadway  and 
right  of  way  acquired  by  them,  is  for  public  use,"  etc.  (reading  the  first 
section).  Now,  the  object  of  that  section  is  to  make  operative  the 
twenty-first  section  of  the  Constitution,  which  refers  to  discrimina- 
tion. It  is  true  that  there  is  a  provision  in  the  statutes  which  is  sup- 
posed to  be  the  governing  law  of  the  Board  of  Railroad  Com  mis- 


219 

sioners,  and  that  there  is  a  provision  there  in  general  terms, 
conveying  simply  the  idea  that  freight  shall  be  forwarded  upon  the 
same  terms  for  all  to  all  places;  but  I  take  it,  that  when  the  Board 
of  Commissioners  found  that  they  had  to  take  this  section  of  the 
Constitution,  which  prescribes  that  there  shall  be  no  discrimination, 
they  found  that  it  was  not  possible  to  prevent  it  under  this  statute. 
Therefore,  I  have  incorporated  a  provision  going  directly  to  this 
point  of  discrimination,  which  takes  it  up  with  more  particularity,, 
and  prescribes  a  punishment,  which  to  my  mind  will  be  efficacious. 
Laying  down  the  principle  that  the  railroads  are  subject  to  the  con- 
trol of  the  State,  as  embodied  in  the  present  Constitution  upon  this 
point,  we  have  those  principles  in  the  bill,  and  the  first  step  has  been 
taken  to  prevent  discrimination  by  railroad  companies. 

Now,  in  regard  to  section  two.  I  presume  that  gentlemen  of  the 
committee  are  more  or  less  familiar  with  it.  Its  object  is  to  afford 
information  to  shippers,  or  other  persons  who  may  be  more  or  less 
connected  with  railroad  transportation  in  forwarding  or  receiving 
freight,  by  prescribing  the  posting  schedules  of  the  rates  in  all  rail- 
road companies'  offices.  In  the  bill,  as  first  drafted,  there  wTas  a 
proposition  that  they  should  be  required  to  furnish  copies  of  such 
schedules.  The  object  was  this :  In  all  systems  of  railroads  outside 
of  this  State,  under  the  control  of  Railroad  Commissioners,  like  the 
State  of  Georgia,  or  Illinois,  there  were  schedules  printed  on  the 
basis  of  uniform  charges  per  mile,  and  instead  of  being  a  book  of 
two  hundred  and  eighty-two  pages,  as  in  this  State  for  a  few  staple 
articles,  wq,s  only  about  six  or  eight  pages.  The  adoption  of  the  bill, 
as  it  originally  stood,  would  have  compelled  the  railroad  corporations 
to  have  adopted  a  system  of  charges  which  would  have  been  rational, 
clear,  and  brief,  so  that  any  person  in  a  trifling  space  of  time  could 
have  ascertained  exactly  the  system  under  which  the  charges  were 
made  for  any  distance;  and  a  double  result  would  have  been 
obtained:  First,  the  information  sought  would  have  been  accessi- 
ble to  every  person  in  California;  and  secondly,  the  means  or  mode 
of  information  would  have  been  supplied  which  would  enable  ship- 
pers to  protect  themselves,  and  enable  the  general  public  to  under- 
stand this  subject,  without  being  compelled  to  use  a  confused  and 
involved  mass  of  figures,  such  as  the  railroad  company  have  inserted 
in  this  book  of  two  hundred  and  eighty-two  pages.  In  the  bill  now, 
that  has  been  altered  so  that  the  railroad  companies  are  compelled 
to  furnish  the  schedule  only  for  examination.  Even  then  it  is  bet- 
ter than  any  rule  regulating  it  at  the  present  time.  It  is  absolutely 
impossible  for  people  to  obtain  any  information  whatever  on  this 
subject  of  freight  rates.  The  railroad  agents  do  not  know  it  them- 
selves. They  are  frequently  compelled  to  telegraph  to  headquarters 
to  ascertain  what  they  shall  charge  upon  certain  articles.  I  say  that 
the  system  is  designedly  involved  and  intricate,  with  all  due  defer- 
ence to  the  committee,  and  I  believe  that  some  redress  should  be 
offered  to  the  public,  so  that  their  rights  may  be  maintained.  Now, 
supposing  that  such  schedules  shall  be  furnished  to  the  public  in  this 
manner,  the  section  continues,  "Such  rates  shall  be  equally  availa- 
ble," etc.,  (reading  remainder  of  section  two).     Now,  Mr.  Chairman, 


220 

it  seems  to  me  that  under  any  intelligent  system  of  railroading  there 
should  be  no  objections  raised  to  the  provisions.of  this  section.  Why 
is  it  not  right,  that  if  the  railroad  company  make  a  distinction  for 
freight  purposes  of  fast  and  slow  freights,  that  those  terms  should  be 
equally  available  to  everybody?  That  if  my  neighbor  gets  a  discount 
on  his  freight  I  should  be  denied  the  same?  If  my  neighbor  pays  cash 
and  gets  a  discount,  why  should  I  be  denied  the  right  and  opportunity 
to  the  same  ?  If  he  pays  more  for  sending  goods  by  fast  freight  than 
for  slow  freight,  whj'  should  I  not  have  the  same  privilege  on  the 
same  terms?  Besides  that,  there  should  be  no  distinction  between 
him  and  me.  When  a  freight  bill  is  sent  to  my  neighbor,  and  he 
pays  it,  he  should  not  be  able  at  the  end  of  thirty  days  to  go  down  to 
the  treasury  of  the  railroad  company  and  draw  the  amount  of  money 
which  represents  the  difference  in  charges,  which  lie  enjoys  as  a 
special  favor,  and  which  I  do  not  enjoy,  unless  I,  too,  make  a  special 
contract.  My  neighbor,  who  is  engaged  in  the  same  class  of  business 
that  I  am,  should  not  be  permitted  under  the  special  contract  sys- 
tem to  get  special  rates  on  the  very  articles  that  I  am  bringing  here, 
and  which  the  railroad  company  has  said  he  shall  be  permitted  to 
bring  upon  more  favorable  terms  than  myself.  In  other  words, 
the  railroad  companies  should  not,  and  shall  not,  be  permitted  to 
make  themselves  a  partner  with  every  man  engaged  in  business  in 
this  State,  if  they  chose,  and  determine  how  much  his  receipts  shall 
be.  They  should  not,  and  shall  not.  determine,  where  his  receipts 
are  large,  how  much  that  business  will  bear,  and  then  make  such 
arrangements  by  special  contract  and  special  tariffs  as  to  take  the 
control  of  the  receipts.  Thus  they  could  go  through  the  whole  line 
of  business  and  put  on  their  tariff  here  and  there,  to  make  a  revenue 
of  profit  from  every  source,  until  they  will  hardly  allow  a  business 
man  to  exist  or  to  maintain  themselves. 

Now,  if  the  system  of  special  contracts  is  to  be  allowed  in  this 
State,  and  if  no  means  are  adopted  by  this  Legislature,  or  by  the 
Board  of  Railroad  Commissioners,  to  prevent  it,  the  mercantile  com- 
munity of  California  will  be  reduced  to  a  condition  of  servitude, 
under  which  I  believe  no  industrial  or  mercantile  community  in  the 
history  of  the  globe  has  ever  existed.  The  principal  reason  why  our 
business  enterprises  are  slumbering  to-day  results  from  the  condition 
of  debasement  and  slavery  under  which  business  men  are  at  the 
present  time  existing.  Our  business  men  have  no  enterprise.  Why 
has  eastern  capital  sought  out  adjoining  territory  to  California?  Is 
it  not  because  we  are  restricted  and  bound  within  narrow  limits  by 
this  corporation.  They  have  lost  all  desire  to  extend  business  enter- 
prises, knowing  full  well  that  every  dollar  of  profit  and  every  cent  of 
gain  is  so  much  upon  which  the  railroad  corporations  may  base  a 
further  charge.  What  object  has  the  business  man  of  San  Francisco 
to  swell  his  trade  or  increase  his  business  when  he  knows  that  down 
at  the  junction  of  Fourth  and  Townsend  Streets  the  railroad  com- 
pany are  ready  to  figure  on  how  much  more  they  can  extract  from 
him  in  the  way  of  charges  and  in  the  way  of  toll.  Now,  I  believe, 
that  here  in  the  State  of  California  there  is  a  complete  and  thorough 
knowledge  of  the  far  reaching  effects  of  the  system  of  special  con- 


221 

tracts,  and  of  the  necessity  for  a  change,  and  I  believe  that  in  the 
mind  of  every  jnst  and  fair  man  there  is  a  comprehension  of  the 
principle  that  all  men  ought  to  be  charged  the  same  price  for  the 
same  services.  I  think  I  need  say  nothing  further  on  that  subject, 
but  will  leave  it  entirely  to  your  judgment. 

(Reading  section  third.)  I  deem  that  section  three  is  entirely 
within  the  purview  of  this  bill  for  the  reason  that,  in  order  to  pre- 
vent railroad  abuses,  I  believe  that  it  is  within  the  limits  of  wise 
legislation  to  prescribe  a  system  for  railroad  corporations  that  will 
render  them  subject  to  State  control  in  such  manner  that  the  result 
will  be  beneficial  to  shippers,  and  to  prevent  the  abuses  of  railroad 
transportation.  What  redress  have  we  if  railroad  companies  are 
permitted  to  absolutely  destroy  and  tear. up  and  remove  facilities  for 
transportation  which  they  have  used?  What  system  of  railroad 
transportation  would  be  complete  that  would  permit  railroad  com- 
panies to  tear  up  and  remove  all  means  of  transportation?  I  would 
say,  then,  that  it  is  a  hypercritical  objection  to  come  in  here  and  state 
that  that  section  is  not  within  the  province  of  the  Legislature  of  the 
State  of  California,  or  that  it  does  not  in  any  manner  relate  to  the 
other  sections  of  the  bill.  A  further  objection  was  raised  here  last 
March,  when  I  had  the  honor  of  appearing  before  the  committee  in 
reference  to  circumstances  of  this  character :  What  is  the  effect  of  the 
bill  when  a  railroad  company  runs  a  side  track,  either  for  some  one 
else  or  for  its  own  purposes,  to  quarries  or  gravel  beds  or  other  things 
of  that  character  belonging  to  itself?  I  believe  I  am  within  the 
limits  when  I  say  there  are  very  few  occasions  when  the  railroad 
company  will  run  side  tracks  for  anybocty  but  itself  for  such  pur- 
poses. But  suppose  it  does.  This  section  states  that  the  track  must 
be  maintained  for  the  purposes  for  which  it  was  constructed.  When 
a  quarry  was  worked  out,  what  Court  would  say  that  it  ought 
to  be  maintained?  Are  we  to  presume  that  a  Court  in  carrying  out 
this  section  to  the  letter  would  violate  it  in  the  spirit?  It  is  to  pre- 
vent such  things  as  have  been  done  by  the  railroads  within  this 
State,  as  when  the  Central  Pacific  Railroad  Company  destroyed  that 
magnificent  wharf  at  Santa  Monica,  at  which  the  largest  ships  could 
float  which  come  to  the  Pacific  coast;  a  place  at  which  vessels  might 
anchor,  and  .where  great  industries  were  growing  up  by  which  that 
whole  section  of  country  was  becoming  populous.  The  railroad 
company  in  a  few  hours  destroyed  that  wharf,  or  destroyed  the  con- 
nection by  which  it  existed.  I  believe  that  a  railroad  corporation 
that  would  do  such  a  thing  as  that  must  be  controlled  within  narrow 
limits;  that  it  must  be  held  under  such  control  that  hereafter  the 
people  shall  not  be  liable  to  outrages  or  acts  of  vandalism  of  that 
character.  If  they  can  destroy  a  structure  of  that  character  when- 
ever in  their  belief  a  road  is  growing  up  that  promises  competition, 
whenever  anything  is  done  by  any  individual  by  building  a  wharf 
in  connection  with  a  railroad  by  establishing  facilities  for  public  use 
on  or  near  a  system  of  railroads,  unless  some  check  is  placed  upon 
these  corporations  they  will  step  in  and  either  compel  him  to  sell  at 
a  reduced  price  or  render  it  comparatively  worthless  by  a  repetition 
of  such  acts  as  I  have  mentioned.     I  ask  if  it  is  right  for  the  people 


222 

of  the  State  of  California  to  be  subjected  to  such  acts  of  injustice, 
and  such  gross  outrages?  and  whether  it  is  true  that  under  the  pro- 
visions of  this  section  any  injustice  can  be  done  to  the  railroad  cor- 
porations by  any  suggestion  that  it  would  affect  the  side  tracks,  or 
temporary  tracks,  or  tracks  built  for  the  purpose  of  carrying  passen- 
gers or  freight  while  repairs  are  being  made  on  the  main  line?  I 
ask  if,  under  the  provisions  of  this  bill,  acts  of  that  character  are 
prohibited  at  the  expense  of  or  under  the  penalty  of  a  loss  of  their 
charter?  I  ask  the  lawyers  on  this  committee  whether,  from  consid- 
eration of  cases  of  this  character,  they  would  omjt  the  penalty  for 
cases  plainly  within  the  provisions  of  this  bill?  As  it  is,  the  bill  is 
in  its  nature  quasi  penal;  it  imposes. penalties  of  the  gravest  charac- 
ter, and  I  presume  that  any  Court  in  construing  it  would  not  give 
any  different  rule  of  construction  or  interpretation  than  what  is 
implied,  for  the  purpose  of  doing  an  injustice. 

As  to  section  four,  the  object  of  that  section  was  merely  to  restrain 
the  railroad  corporations  in  the  State  of  California,  whether  they 
came  from  the  outside  or  proceeded  from  the  inside,  and  keep  them 
entirely  within  the  State  control.  It  is  hardly  necessary  to  recall  to 
gentlemen  of  this  committee  that  only  a  short  time  ago,  at  the  last 
session  of  Congress,  a  bill  was  introduced  permitting  the  Southern 
Pacific  Railroad  system  in  California,  Arizona,  and  New  Mexico  to 
•consolidate.  A  resolution  was  passed  through  both  Houses  protest- 
ing against  it.  In  regard  to  this  matter,  I  have  to  say,  that  if  a  cor- 
poration comes  into  the  State  it  is  a  foreign  corporation,  and  the 
Board  of  Railroad  Commissioners,  being  in  their  character  somewhat 
•of  a  judicial  body,  should  they  assume  jurisdiction  of  that  corpora- 
tion, a  question  might  arise  as  to  whether  or.  not  any  judicial  body, 
even  if  qualified  with  extraordinary  powers,  would  have  the  right  to 
prescribe  the  rates  of  fares  and  freights  of  such  foreign  corporation. 
Now,  it  might  be  that,  under  the  extraordinary  powers  of  the  Board 
of  Railroad  Commissioners,  the  question  might  be  decided  in  favor 
of  the  State  of  California;  but  do  the  people  of  the  State  want  to  see 
the  power  taken  from  the  Board  of  Railroad  Commissioners  by  rais- 
ing a  question  of  constitutional  power  ?  Whether  this  body,  being 
such  a  body,  could  exercise  functions  somewhat  judicial  in  their 
character  over  a  foreign  corporation?  And  being  non-residents  of 
the  State  of  California,  would  they,  in  a  proceeding  of  that  character, 
have  the  right  to  go  into  the  Federal  Courts?  While  it  may  be  true 
that  the  Federal  Courts  are  just  as  fair,  and  dispense  the  same  jus- 
tice, as  the  State  Courts,  still,  the  sovereignty  of  the  State  of  Califor- 
nia is  vindicated  in  your  own  Courts,  and  it  is  to  her  interest,  when 
she  bestows  favors  on  anybody,  to  ask  that  they  have  their  differences 
and  difficulties  settled  in  her  State  Courts.  Why  should  we  permit 
a,  railroad  corporation  to  enjoy  privileges  not  given  to  other  citizens, 
or  permit  them  to  derive  an  advantage  of  great  investments  and  cor- 
responding profits  in  the  State  of  California,  and  at  the  same  time  be 
independent  and  free  from  the  control  of  her  Courts?  Is  that  the 
policy,  or  is  it  the  statesmanship,  which  should  govern  the  legisla- 
tors of  the  State  of  California,  looking  out  for  the  best  interests  of 
their  State?     A  corporation  of  that  kind,  continuous  in  its  extent, 


223 

owning  properties  in  two  or  more  States  or  Territories,  and  making 
contracts,  or  entering  into  mortgages  affecting  that  property  or  being 
furnished  with  a  system  of  mortgages  or  obligations  extending  beyond 
the  State,wouldbea  source  of  confusion  under  our  system  of  taxation. 
I  will  give  an  instance:  Suppose  that  a  system  of  mortgages  covers 
a  railroad  from  the  City  of  San  Francisco  to  the  Rio  Grande;  sup- 
pose that  it  is  a  continuous  line  of  railroad,  forming  a  unit,  in 
assessing  it  we  should  become  involved  in  the  complications  of  its 
connections  in  different  places  of  its  system  of  properties,  mort- 
gages, and  rolling  stock  running  into  different  States.  Would  all 
this  line  running  in  the  different  States  have  to  be  segregated  into 
parts  in  order  to  determine  how  much  the  great  State  of  California 
is  to  receive  by  taxation?  Why  should  we  do  that?  Why  should 
we  subject  ourselves  to  those  difficulties?  Why  should  a  corporation 
in  the  State  of  California  be  permitted  to  extend  its  power  outside  of 
the  State,  and  to  take  a  charter  from  another  State  ?  When  it  has  a 
charter  in  this  State  and  forfeits  it,  what  right  and  how  could  that 
forfeiture  affect  the  corporation  beyond  the  line?  What  control 
would  we  have  over  our  corporation  when  beyond  our  borders? 
The  question  would  come  up  in  any  ordinary  difficulty ;  it  is  a  ques- 
tion of  the  gravest  magnitude  and  one  that  has  never  been  deter- 
mined in  our  Courts.  We  can  have  this  matter  in  such  a  condition 
under  this  section,  that  we  can  have  such  property  and  roadbed  sub- 
jected to  the  same  control  as  the  property  of  private  individuals 
in  this  State.  These  are  but  a  few  of  the  difficulties  that  present 
themselves  to  me.  At  the  present  time  there  is  no  provision  in  the 
laws  of  the  State  of  California  for  any  mode  of  forming  a  corporation 
except  by  incorporating  within  the  State,  and  the  only  way  in  which 
this  question  can  be  raised  would  be  when  some  of  the  Federal  cor- 
porations came  into  the  State,  or  some  of  our  own  roads  should 
merge  with  roads  from  the  outside,  acting  under  a  Federal  charter. 
Under  such  circumstances,  to  what  extent  could  we  tax  the  Federal 
corporation,  and  to  what  extent  could  we  control  it?  The  result,  to 
my  mind,  of  all  these  questions  is  simply  this,  that  insomuch  as  the 
people  of  the  State  permit  these  public  agents  to  derive  the  benefit 
and  a  profit  by  the  investment  of  their  means  for  the  public  use  in 
operating  a  road  for  the  public  benefit,  and  when  the  people  of  the 
State  permit  them  to  take  toll  for  transportation  of  freight  and  pas- 
sengers over  the  highway  thus  established,  we  should  insist  that 
these  roads  shall  remain  entirely  within  the  control  of  the  State  of 
California.  We  have  a  right  to  doit,  and  I  believe  that  we  should  never 
surrender  that  right.  We  have  a  right  to  say  to  any  corporation  within 
the  State  of  California:  "  You  have  organized  under  our  laws  as  an 
agent  of  the  State  of  California,  and  now  if  you  attempt  to  go  beyond 
our  borders  and  to  consolidate  with  other  roads  receiving  benefits 
from  foreign  corporations,  either  from  the  United  States,  or  from  any 
of  the  States,  you  shall  not  exist  under  the  laws  of  this  State.  You 
shall  no  longer  enjoy  the  profits  and  benefits  which  we  gave  to  you. 
You  are  a  creature  of  the  State  of  California,  and  you  shall  not  escape 
our  control  and  set  our  laws  at  defiance."  Is  it  possible  to  legislate 
upon  this  subject?    I  claim  that  it  is.     It  is  claimed  that  it  is  defeat- 


224 

ing  competition.  I  believe  that  it  will  encourage  competition  and 
competition  based  upon  principles  of  firmness  and  equity — a  compe- 
tition which  is  within  the  control  of  the  State  of  California,  which 
should  derive  the  benefit  from  the  competition.  Who  is  most  enti- 
tled to  those  benefits,  the  railroad  people  or  the  State  of  California  ? 
Who  will  derive  the  profit?  And  what  competition  will  be  of  any 
avail  if  the  competing  parties  are  to  pay  nothing  towards  the  burdens 
of  the  people  of  the  State?  Are  they  to  enjoy  these  rights  from  the 
people  of  the  State  and  yet  be  beyond  her  control?  I  say  that  it  is 
the  better  policy  that  any  body  of  men  who  desire  to  incorporate 
under  our  laws  should  comply  with  the  provisions  of  our  Code,  and 
so  locate  their  lines  as  to  begin  at  the  borders  and  connect  there  with 
others;  and  in  that  way  we  would  have  a  complete  chain  of  roads, 
affording  competition  in  every  particular,  and  based  upon  the  laws 
of  supply  and  demand.  Whenever  the  people  of  the  State  can  sup- 
ply competing  roads  they  will  be  built  upon  the  conditions  I  have 
named — and  they  will  be  built.  There  is  a  widespread  misconcep- 
tion as  to  the  effect  of  this  matter.  I  do  not  think  it  necessary  to 
express  my  views  further  before  this  body  of  lawyers  as  to  how  a 
corporation  beyond  the  State  control  should  be  managed  with  refer- 
ence to  this  State. 

As  to  the  next  section.  Section  four  hundred  and  one  of  the  Civil 
Code,  provides,  in  connection  with  another  section,  that  railroads  in 
this  State  may  consolidate  and  become  corporations,  etc.  There  is 
no  statute  determining  how  long  a  railroad  corporation  shall  last. 

If  it  be  true  that  a  corporation  commences  its  existence  from  the 
time  it  files  the  original  papers,  and  that  it  continues  its  life  by  con- 
solidating with  other  corporations,  we  might  as  well  strike  that  pro- 
vision from  our  Constitution,  so  far  as  it  says  that  the  Legislature 
shall  not  have  the  power  to  extend  the  corporate  franchise,  because 
it  would  only  be  necessary  for  a  body  of  men  to  organize  a  small 
road  to  last  for  fifty  years,  and  when  it  is  about  to  expire  to  consoli- 
date with  another  which  is  younger,  and  thus  its  existence  w7ould 
never  be  brought  to  a  close.  Why  should  we  permit  that?  That 
was  not  the  intent  of  that  system  of  consolidation,  and  I  do  not 
believe  that  it  is  now,  under  the  provisions  of  the  Constitution,  to 
enact  laws  which  contemplate  the  existence  of  a  corporation  for  more 
than  fifty  years ;  and  I  believe  every  road,  or  corporation  which 
enters  into  the  consolidation  should  terminate  with  the  existence 
of  the  oldest.  Why  should  the  Central  Pacific  Railroad  consol- 
idate with  any  other  road  in  1871,  and  thus  continue  its  existence 
ten  years  longer  than  the  time  provided  by  law,  thus  existing 
for  sixty  instead  of  fifty  years.  If  the  principle  is  correct,  that 
a  corporation  shall  exist  in  this  manner,  if  it  is  never  ending, 
what  protection  will  the  people  of  the  State  of  California  ever  have 
when  it  swells  and  grows  till  it  overreaches  the  whole  of  the  State  ? 
I  believe  that  it  is  essential  that  any  system  of  transportation  should 
.give  justice  between  the  railroad  and  the  people,  and  if  it  is  incor- 
porated here,  or  consolidated  here,  subject  to  this  section,  I  believe 
that  there  will  be  no  objection  made  to  it,  such  as  would  be  were  it 
incorporated  outside  of  the  State,  or  extended  by  consolidation 
beyond  the  control  of  the  State. 


225 

In  regard  to  section  six.  Any  turnpike,  or  toll  road,  or  public 
highway  of  that  character,  for  a  public  use,  is  under  the  control  of 
our  laws,  so  that  if  the  public  desire  to  use  the  road  no  Court  can 
deprive  them  of  it.  No  Court  or  Legislature  can  do  it.  I  think  it  is 
a  fundamental  principle  that  they  belong  to  the  people.  Now  what 
does  this  provision  accomplish  ?  (Reading  section  six.)  No  lawyer 
would  ever  give  that  any  other  construction  in  the  world,  except 
that  it,  is  the  roadway  and  right  of  way  which  remain  and  are  for 
the  public  use.  And  the  other  property  is  to  be  distributed  among 
the  stockholders.  It  is  no  new  principle,  it  is  as  well  settled  and 
established  as  the  right  of  the  State  to  a  reversionary  interest  in  the 
public  lands  after  the  railroads  shall  have  abandoned  them.  What 
is  the  difference,  in  principle,  between  calling  a  railroad  a  public 
highway  and  a  turnpike  a  public  highway?  Wherein  is  the  distinc- 
tion ?  I  believe  that  this  provision  of  the  bill  simply  announces  the 
law,  and  is  put  in  here  because  it  is  only  necessary  to  provide  what 
shall  be  done  with  the  property  of  the  railroad,  after  its  rights  shall 
determine  how  these  penalties  shall  affect  them,  and  for  the  reason 
that  it  interjects  in  this  system  a  provision  that  must  be  made  for 
the  disposition  of  the  property.  It  makes  complete  and  carries  out 
the  system  and  accomplishes  every  object  which  could  be  asked  for 
the  control  of  the  railroads,  without  in  any  way  inflicting  upon  them 
the  penalty  which  the  Legisluture  might  impose  upon  them  at  the 
termination  of  their  charter. 

Section  seven — I  believe  that  it  is  proper  that  a  penalty  should  be 
fixed  which  would  be  most  efficacious.  I  believe  that  a  penal  fine 
or  imprisonment  would  be  perfectly  useless.  I  believe  that  a  corpor- 
ation which  is  powerful  and  wealthy  would  protect  its  employes  if 
they  were  brought  into  a  Court  of  justice,  and  pay  fines  if  imposed, 
and  that  a  fine  would  fail  to  reach  and  correct  the  violation  of  the 
laws.  I  do  not  believe  that  if  the  Directors  of  the  Central  Pacific 
Railroad  Company  found  themselves  in  danger  of  incarceration  in  a 
jail  that  they  would  permit  any  such  violation.  I  think  that  they 
would  seriously  hesitate  and  long  deliberate  before  they  would  enter 
upon  any  system  of  practical  discrimination  or  extortion.  The  pen- 
alty is  severe  and  for  that  reason  it  is  merciful.  It  will  accomplish 
the  object  and  prevent  the  crime,  and  if  it  does  so  I  believe  that  it 
should  be  retained  in  this  section. 

As  to  the  final  provision  of  this  bill,  it  is  only  prescribing  under 
the  provisions  of  article  twelve,  section  twenty-two,  the  mode  of 
enforcing  the  rates  of  freights  and  fares  that  the  railroad  company 
has  prescribed,  and  I  believe  that  it  will  insure  a  compliance  by  the 
railroad  corporations  with  those  rates.  Article  twelve,  section  twenty- 
two,  of  the  Constitution,  says  that  the  Legislature  may  pass  such  laws 
as  will  insure  a  compliance,  etc.  I  believe  that  the  Attorney-Gen- 
eral should  sue  out  a  writ  of  mandate  in  case  the  Board  should 
fail  to  obey  the  Railroad  Commissioners,  to  compel  a  compli- 
ance with  their  directions.  Why  ought  they  to  be  permitted  to 
evade  these  provisions  which  the  law  and  the  Constitution  say 
are  right  and  just?  Why  should  the  whole  people  of  the  State 
of  California  for  three  or  four  years  be  kept  waiting  for  a  decis- 


226 

ion  of  the  Supreme  Court,  when  the  matter  ought  to  bo  settled  at 
once  as  to  whether  or  not  the  Railroad  Commissioners  should  fix 
those  rates?  The  rates  are  conclusive,  and  the  only  question  should 
be,  do  the  railroads  comply  with  them?  What  objection  ought  to 
be  urged  to  the  right,  of  the  State  to  tut  stay?     Under 

the  criminal  law  a  man  would  have  to  go- to  the  State  Prison  pend- 
ing an  appeal,  unless  he  has  b  certificate  of  probable  cause.  Under 
the  common  law,  not  only  stay  on   appeal   was   usually  but 

even  the  right  of  appeal  itself.     There  is  no  stay  in  c  went 

against  defendant  for  unlawfully  holding  public  office.     It 
that  the  right  of  stay  on  appeal  is  common  to  .  -      er  the 

common    law,  and  when  the  railroad   •  '■■  dent 

bom  the 

respondent.  What  bond  should  be  given  to  protect  the  State  ol  Cali- 
fornia? To  whom  should  the  bond  run?  What  would  be  the  ben- 
efit of  that  bond  ?  I  say  that  to  give  a  bond  in  such  a  case 
would  be  child's  play;  it  would  be  trifling  with  the  principles 
upon  which  the  Board  of  Railroad  Commissioners  acts  and  upon 
which  it  was  established.  The  rates  of  the  railroads  should  be 
established,  and  they  should  be  compelled  to  abide  by  them.  I 
say  that  it  is  a  gross-  injustice  to  permit  them  to  take  an  appeal 
from  a  writ  of  mandate.  They  should  comply  with  the  law  made 
by  the  people  of  the  State  of  California  or  forfeit  their  charter. 
Those  are  the  provisions  of  the  bill  as  I  understand  them,  and  the 
objects  which  it  seeks  to  accomplish;  and  I  do  not  know  that  I  care 
to  say  anything  further  in  regard  to  it. 
I  thank  the  committee  for  its  kind  attention. 


The  following  is  a  copy  of  the  bill  as  amended  in  the  Judiciary 
Committee,  after  discussion  by  the  members  thereof.  Whereupon, 
upon  motion  of  Senator  Johnson,  the  same  was  reported  back,  and 
its  adoption,  as  amended,  recommended,  by  the  following  vote: 

Ayes — Messrs.  Taylor,  Spencer  of  Napa,  Reddy,  Baldwin,  Johnson, 
Kelley  of  Solano,  Kellogg,  Sullivan,  McClure,  Del  Valle,  Brooks, 
Murphy,  and  Cross. 

Noes — Messrs.  Vrooman,  Perry,  and  Whitney. 

\_Am  ,  . — 7/,,\j 

ASSEMBLY    BILL    No.    10. 

[Introduced  by  tin   Barby,  March  25,  I  red  to  C min a  Corporations.] 

An  Aci    m    Prkvest  Discriminations  and  A  husks  isy  Railroad  Corporations. 

The  People  of  Ike  State  of  California,  represi  nted  in  Senate  and  Assembly,  do  enact  as  fo 

Suction  1.  All  railroads  built  or  owned  by  corporations  organized  under  the  laws  of  the 
State  are  public  hi  >ver  which   ill  persons  are  entitled  !<>  transportation  for  persons  and 

property  on  ooual  and  impartial  terms.  All  roadway  and  right  of  way  acquired  by  sued  com- 
panies is  tin-  public  use.  All  person-;  ami  companies  engaged  in  operating  any  such  road,  or  in 
transporting  freighl  oi  p  over  the  same,  or  which  -hall  hereafter  operate  or  engage  as 

aforesaid,  shall  forward,  move, and  carry  impartially  for  all  persons  offering  freight  to  ho  trans- 
ported or  moved,  without  discrimination,  preference,  or  favor  to  one  over  another,  in  price, 


227 

:h,  speed,  or  accommodi  ■'.  [as  to  freight  of  "the 

:,  provided. 

kind  or   class  1  shall    I  ''  in  which 

dered  fo 

per- 

[facilitii 

for  the  i 
on  like 
and  deli'  laugin 

i 

all 

■ 

trim- 
.011- 
g  more  s  than  such 

forbid  lei  ablished  and  publi 

paymeu 

carload  lots,  and  for  lots  under  a   carload ; 
[and  a  I  d  for  long  distances  Hum  is  charged  per  mile  for  short 

distances . foi  ts;]  all  such  rates  and  discounts  to  be  available  to 

all  applicants  on  equal  I 

Sec.  3.     All  railroad  <  II  times. maintain  all  their  track  and  other  struc- 

tures [devoted  to  a  public  us  at  repair  and  in  a  state  of  complete  efficiency 

for  the   :  for  which   tl  constructed  or  adopted.     Any  such  Hack  or  structure 

decayed,    I  I,  or  roniovcd'mi  •  restored  to  as  good  or  better  con- 

dition oi  i)  '  noval,  [if  necessary  or  convenient 

to  the  public 

Sec.  4.  i  tate  is  permitted 

any  chart  rereignty;  and  no 

corpo  Per~ 

mitti  railroad  or  lil  within  this  State. 

hundn  d  :  does  not  apply  to  railroad  corpora- 

tions formed  by  the  c  term 

i  :d  <hall  not  .ond  that  of  any  of  the  corpora- 

tions •     ■ 

liration  or  forfeiture  ol  road 

and  right  i 

other]  ■  rpaymentoi  and  liabilities,  divided 

olders.  •  _ 

the>  ■  or  four  of 

this  Acl  idged  to  have  incu 

Buch   G  d,  in  an  action 

instituted  by  tl  ,  no  acl  of  any 

the  pro  poration.  unless  auth 

orratifiedb)  tin    Board  oi  D  Any  officer,  agent,  or  servant  of  any  railroad  com- 

pany, who  shall  [knowingly]  take  pafi  ing  out,  or  enforcing  ol  any  con- 

tract or  agreement  foi  toad  tra  a  oi  provisions  ol'  this  Act,  or  in 

collecting  charges,  or  paying  or  allowing  discounts  i  now- 

inglj  and    \   I  ball,  directly  or  indirect  my  agreement  or  und< 

i  direction  on  terms  in 

any  r  prescribed  in  this  Act,  or  fui'thi  i  nit  or 

rebate  hereby  forbidden      i  □  as  of  thi     tel   in  any   particuli 

deemed  guili  j  o\  anor. 

Railr  it  put 

in  force  and  complied  with  by  the  railroad  companies  affected,  may  be  enforced  by  writ  ot 
mandate  cm  behalf  of  the  people  Attorney-General.     Any  company  fail- 

ing or  refusing  to  comply  with  a  peremptory  man  lat<  sued  in  such  action  shall  forfeit  its 
charter  and  be  di  ssolvi  d.  On  appeal  from  judgment  awarding  a  peremptory  mandate  in  such 
eases  there  shall  be  no  slay  of  proceedings  on  appeal. 


228 

I  certify  the  foregoing  to  be  a  correct  copy  of  the  statements  and 
exhibits  considered  by  the  Judiciary  Committee  of  the  Senate  of  Cal- 
ifornia, as  shown  by  the  phonographic  reporter's  notes,  as  transcribed 
by  him  for  the  committee. 

C.  W,  CROSS, 

Chairman. 


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